BeamaLife Blog

There are several reasons why you may want to replace your current life insurance policy with a new one.

If you have term life insurance, you may want to replace your policy to reduce the price, extend the coverage period, or increase the amount of insurance. Keep in mind, though, that you likely will be required to go through a medical exam.

Replacing your permanent life insurance gets more complicated and careful consideration should be given:

• Unless you’re considering whole life insurance, the current interest rate that your cash value earns is not guaranteed. There is a guaranteed minimum interest rate that is usually considerably lower than the current rate. A Life Insurance Agent may show you projections of what your cash value will earn over the next 15 or 20 years in Variable Policy but it is not guaranteed.
• The initial costs of a life insurance policy are high. As a result, your cash value could be reduced.
• If you cancel a life insurance policy early, you’ll have to pay a surrender charge, a fee that can be expensive.
• Make sure you have the new policy in your hand before you cancel the old one.

Remember that incontestability and suicide clauses will be in effect for the first two years of your new policy. An incontestability clause states that the insurance company may not contest the policy after it has been in force for two years. The only exception is for nonpayment of the premium. A suicide clause states that the insurance company will not pay the death benefit if the insured dies by suicide within the first two years of the issue date.

Please call BeamaLife Sales Specialists at (866) 972-3262 and they will help you to make right decision.