Can You Change a Life Insurance Policy?
Policy holders need not fear because they can make modifications to their insurance plans. Insurance carriers understand the importance of making policies flexible enough to accommodate changes in people’s lifestyles. In general, there is little maintenance to be done for insurance policies except for on time payments to premiums, on top of keeping the insurance agent informed about all the details to keep the policy holder’s file updated. Personal information should be kept up to date. For example, an additional child or change in status like getting divorced or married should be conveyed to the insurance carrier. Probably the most important detail that should be updated is the choice of beneficiary.
Other modifications can include a conversion of a term life plan into a whole life plan. Basic changes can be done to almost any type of life insurance policy but when it comes to conversions, only some policies can qualify for such. The type and frequency of changes that can be done to your policy depends on the insurance company. Most of the time, the insured is given enough room for adjustments to fit their changing lifestyle needs.
Basic information should be kept updated constantly. With so many things taking place when one moves to a new home and changes to a phone number or name, notifying your insurance provider might be last on the list of things to do. Try to make a habit of reviewing your insurance policy at least once a year. This will keep your file valid. Also, if there is current data to be added or used to replace the old file, you will remember to make the correction upon seeing the errors. This practice isn’t limited to just your basic information, all aspects of the insurance plan must be reviewed and corrected accordingly in an annual basis.
It is not uncommon to find policy holders who make changes in the beneficiary section of their insurance plan. Most often, this is true when the policy was established early on the insured person’s life. It is certainly possible for some beneficiaries to become deceased over the course of time. Other people might also be included, for instance, when a parent has additional children. More important than the reason for changing, is the act of making the correction itself. Bear in mind that whoever’s name appears in the policy will be the one to receive the proceeds from the death benefit. Under the law, no other recipient will be accepted except for whose names are stated in the insurance policy. If revisions have been made, request a copy of the original and revised policies. These are legal documents. That is why it is pertinent to keep them valid and current constantly.
Most term life policies are convertible to whole or partial life insurance. If you have purchased a term life policy, it is possible to have all or only a portion of it converted to a whole life insurance plan. This usually occurs when the insured party, initially, bought a term life plan but later on decided to upgrade. The process is not complicated and insurance providers are happy to accommodate these requests.