Replacing your Cheap Life Insurance Plan

One might say that replacing a cheap life insurance policy is madness. However, there are times when it is just wise to buy another. This step is like switching jobs. It is highly probable that you will be put into predicament especially when you have been paying for your existing plan for quite a while. Situations like this will certainly require not only deep thinking but sound judgment as well. If you are in a particular condition, look no more for further help as this article will enlighten you about the matter. Below are some words of advice that will come in handy.

• Review your current cheap life insurance plan. –this is the first and important thing to do. Basically, this step is just an evaluation of your present financial needs. One reason why you should replace your existing plan is when there have been significant changes that happened in your life such as having a new addition in your family. Another kid would mean bigger coverage and the “cheap plan” would no longer suffice. Before you make the switch, make an assessment of your current and future needs. Reviewing the plan will give you a good starting point; thus, enabling you to plot your course of action. 

• Consider the premiums. –purchasing a plan always starts with obtaining of insurance life quote and this is still the case when you want to replace the one that you are currently tied into. One logical reason of switching policies is when you have found a cheaper figure. However, there are also other scenarios wherein it is still practical to buy another. One of which is when you find a plan that can provide wider coverage in a slightly higher price that your budget can still afford. Do not forget to compare the price with the features of the plan to determine the reasonableness of the plan.

• Think about the convertibility. –Convertibility is an option that gives you the opportunity to convert your plan into another type without paying ridiculous prices and/or with the exemption of undergoing for the second time through medical exam in the event that you outlive the plan. However, not all types of insurance policy have this benefit. You should find out if you can enjoy the same advantage to the other plan that you are replacing with your current one. Depending on your age, health status and preferred duration, you might want to give up this feature even if it is readily offered.

• Determine the financial stability of the carriers. –cheaper life insurance quote would prove to be worthless if the insurance company will file for bankruptcy in the near future. You should think more than twice if you are nearing the end of the term of your current plan and if the insurer that you keep an eye on is having financial issues. Given the fact that the country is presently in recession, you should be keen in this matter now more than ever. After giving a look on their financial portfolio, you ought to constantly monitor its progress (or decline) so that you will not be caught unaware.

• Reflect on the available riders. –insurance plans may or may not have riders. Riders appeal more than often to elderly, families who want to have great deal, people who have health problems and those who have hazardous job descriptions. Some riders may come together with a plan or sold by insurers as a different product. Most cheap policies do not as these enhancements also require extra payments. Yet, you may stumble upon a policy that has somewhat higher premium but includes a rider that matches your current needs. Think it over if your budget can allow and sustain it all throughout the duration of the new plan.

• What about the contestability periods? –Contestability periods are exclusions and clauses that usually take effect during the first two years of the plan. For instance, the term life insurance no medical exam policy may comprise of an agreement that if the insured elderly would die during the stated period, the insurance company will only reimburse the premiums paid. Decide if you want to go through such periods again if ever you will start anew with another plan.

Under any circumstances, replacing your cheap insurance policy is never an easy task. However, it is certainly doable. With sound judgment and careful planning, you will emerge the victor. 

Article by David Livingston of EQuote, who is also a specialist in financial planning. For more information on life insurance term life and term life insurance no medical, visit his site today.