Why Owning Multiple Life Insurance Plans Makes Sense
November 1, 2022
Owning multiple life insurance plans can benefit you when examining all your options for adequate coverage. Most people have one life insurance policy. Therefore, they may not comprehend how owning more could help them. The goal of any life policy is to meet your financial obligations, settle your debts and provide for your beneficiaries in the event of your death.
Multiple Life Insurance Plans: What You Must Know
If you believe you might get additional benefits from more coverage than you have, you may want to consider additional policies instead of increasing your existing death benefit.
Understanding Your Life Insurance Goals
Before you can determine how much coverage you need from your life policies, you must determine what you are trying to cover. For example, do you have a mortgage you will need to pay off in the next couple of decades? Take all of those elements into account as you decide how much coverage you might need.
Considering The Types of Life Insurance Coverage
Life policies come in many forms. Opting for variety with a mix of policy types is often the best solution when covering many different elements. Term policies are those which are valid for a specific time period. You can choose a policy that’s valid for ten years or even for a couple of decades if necessary. Whole-life or universal-life may be the better solution when it comes to long-term life insurance requirements.
To cover various needs, you may choose one term policy dedicated to your mortgage, another intended to cover your burial services and final expenses, and then permanent coverage to replace your income for the family. Stagger your term policies for your financial commitments and choose a whole-life policy for the burial costs and income replacement to have what you need for your family.
Knowing How Much Extra Life Insurance You Need
Consider the period of life you’re in. Life coverage is a long-term investment, so you need a coverage plan that accounts for any potential long-term changes. For example, young adults should consider the benefits of establishing coverage now for a prospective mortgage, marriage, or children. You may also add policies later, if necessary, in response to changes in your financial situation or your family structure.
Calculating Your Life Insurance Needs
Once you establish that multiple life policies are the right investment, you need to know how much coverage is right. Add up the total of any outstanding debts you want resolved, including any loans or credit cards. Consider the cost associated with your burial and memorial service as well. Those expenses are easier to estimate if you pre-plan your services. Then, multiply your annual income by the number of years of replacement income you want to provide for your family. Use that total to determine your total life insurance coverage needs.
About 1891 Financial Life
At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.
Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.