Acquiring a life insurance policy gives protection to your family and loved ones at the time of a disease, incapacitation, or death. However, in some situations it might not be necessary to have it. For instance, life insurance is not required if you have sufficient savings and investments to support your needs and attain financial stability. If you have savings that are equivalent to your death benefit, it signifies that you are self-insured. You keep the risk that you transmitted to the insurance carrier through the acquisition of the policy. Thus, you may decide to cancel your policy. The following are some of the instances on when it might be the right time to drop your life insurance.
Attainment of the Retirement age
Getting a life insurance may add advantages if you do not have enough savings to pay all your debts and any other financial obligations. The process of building up your savings takes years and requires a sizble input from you and a constant growth rate for your investments. Ideally, an individual no longer needs a life insurance when they reach their retirement age since they already accumulated sufficient savings for their financial needs.
Acquiring life insurance is a commitment that you are obligated to; you will be paying depending on the agreement and terms of the insurance. It is a lifetime commitment until the moment you decide to drop it. You may find your business is only recording losses to the extent that you are not able to maintain it anymore. This will affect your income, and if you find that you have inadequate money, then you can drop your life insurance. You may also have you lost your job, and you didn't have any other source of income. In such a case, you may have no other option but to drop your life insurance.
When your financial need reduces
You may commit to purchase life insurance to cover specific expenses for your loved ones like family. For instance, you may have a policy with the aim of paying school fee for your children without much constrains. Nevertheless, when your children get out of the nest, these expenses disappear, and may not need the insurance. Life is dynamic the initial reasons for you to purchase life insurance changes with time and you may find it is no longer relevant anymore. When you find yourself in such circumstances, it’s the time to consider dropping your life insurance.
Your plan is no longer impressive
People will purchase life insurance due to the benefits it comes with. Recently, insurance companies have become very competitive, creating a wide room for you make changes according to your preference. Therefore, you may decide to drop your insurance to and go for the one with friendly rates. When an individual is purchasing a life insurance, they have a picture of what they what to benefit. In case your life insurance is no longer helpful to you don’t hesitate to drop it. We don’t live to make losses but rather to gain benefits.
When your health changes
As the time goes, numerous changes such as your health status are bound to occur. In addition, life insurance policy might have changed from the first policy when you were applying, and the new updates may differ with the one you used while applying for your insurance. When changes occur in your weight or health, it may change the category in which you fall. For instance, you may fall in preferred, sub-standards or standard and at the end, you pay more in a long time than you expected.
Life insurance is a necessity and not a luxury, especially if covering you and your family. It is of great importance covering health issues and paying the tuition fee for your children. However, this insurance can only be of help to you if you are able to access it when in need and get it on time. Cancelling your life insurance liberates you from paying costly charges, which might be straining to pay due to lack of adequate money. Thus, you can apportion the small saving left with you to more important things than insurance.
Written by Garrett Parker
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