When Should I Consider Increasing My Insurance Coverage?

Family playing togetherAt some point in your life, you may decide that the coverage amount of your life insurance policy is no longer enough. Things have changed, and you need more coverage for greater peace of mind. That’s normal. People often need to increase their coverage.

As part of our ongoing blog posting efforts in answering typical questions about life insurance, here are some ways for determining if you should increase life insurance coverage:

When may I want to increase my life insurance coverage?

It varies, person by person. For example, someone may be having a significant life event, such as getting married or having children. Someone else may have taken on increased debt, such as a mortgage to buy a home or higher living expenses associated with higher income. Or, someone may want more coverage simply because he or she did the math and calculated the need to increase coverage in order to have adequate protection.

How can I increase my coverage?

There are a couple of ways. Some policies, such as the Gerber Life Grow-Up® Plan1, allow you to add onto the original policy at various times. Other policies do not allow you to add onto an existing policy. In such cases, one would need to buy an additional policy or policies to gain increased coverage.

Worth noting: It can be beneficial to retain older policies because the premium may be lower, since premium rates are based on your age when you apply. Also, some people buy an additional term life policy every so many years and then keep it or convert part of it in a certain number of years, in order to create more permanent and ongoing coverage at a less expensive rate than for a whole life policy.

Can my term life policy become permanent?

Possibly, if your term life policy includes a conversion feature. A conversion feature allows the owner to “convert” a term life policy into a whole life policy that will last for as long as you continue to pay for coverage. Although this feature comes at an additional cost, the benefit of being able to extend your coverage, without proof of health, can be invaluable.


1 Policy ICC12-GPP, Policy Form Series GPP-12

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