Importance of Yearly Policy Reviews

by Jeff Oetting / 01 January 2017 / No Comments

Imagine having a life insurance policy and the beneficiary happens to be an ex-spouse. Or, having a policy where you’re paying more money than you should because you didn’t bother to get a new quote. Neither one of these situations are ideal for anyone. That being said, it is crucial for everyone with any type of policy to do a yearly review of their coverages. This can save you money and lots of headache.

Below are the top 4 reasons to do a yearly review, with some of them being topics we recently touched on in the previous paragraph.

 

Money Savings
Sometimes we become comfortable and complacent with our policies. This is because we don’t see an urgent need to change it anytime soon. This may be because we already have a fair rate or because it never crossed our mind. However, if you choose to review it every year, this allows you to shop around for better prices. Even if your rate is already fairly reasonable, it doesn’t hurt to pay less. No one ever complained about paying less. With that being said, review your policy and make sure you’re getting the better deal at the end of the day.

 

Beneficiary Changes
Having a beneficiary is a must for some policies. The most common beneficiaries are an individual’s spouse or children. But, what happens when you two part ways? We’re pretty sure you no longer want that money to go into their pockets. You may want your new spouse (if you have one) to receive the money or your children. Also, what if your beneficiary is your child, but now you’re married so you would like your spouse to receive a portion of that as well? These are all common scenarios that people tend to overlook that have made our clients contact us for a change in beneficiaries. In a busy life, you forget about these things. Always review beneficiary information.

 

The Need for More or Less Coverage
You may currently have a policy that you’re paying too much or too little for due to the wrong reasons. Let’s say your home is now worth $500,000 after remodeling. However, you bought a policy that covers it for up to $300,000. If you don’t act now, you will be liable for all damages that require fixing if it exceeds your coverage limits. Therefore, your coverage should be higher than it currently is. In the other scenario, if your home is covered for $500,000 but it’s only worth $300,000, you’re paying far too much for coverage and it should be reduced.

 

Updated Info
While changing locations, phone numbers and more throughout your life, you need to inform your agent of this information. There is always a chance that not doing this will lead to a voided policy, and you will find yourself in an unfortunate situation if you need to utilize your policy, only to find out that you no longer have it.

 

Policy reviews may not be an ideal activity to engage in, but it is necessary and comes with many benefits. If you would like to setup a time for a policy review, feel free to give us a call at 217-345-7063.

Also, we are free to give quotes if you feel as if you are being overcharged with your current agency.

About the author:

Jeff Oetting, President of Bob Oetting & Associates has been helping families plan for their futures for the past 23 years. Jeff holds an MBA from Eastern Illinois University. In addition to working with his clients to help develop insurance strategies tailored to individuals and families, Jeff is also an instructor in the College of Business at Eastern Illinois University. He is a Certified Insurance Counselor and Certified Risk Manager.

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