Does it make sense to replace a policy?
Think twice before you do, because in many situations it may not be to your advantage. Before dropping any in-force policy, consider: (a) If your health status has changed over the years, you may no longer be insurable at standard rates. (b) Your present policy may have a lower premium rate than is required on a new policy of the same type (if, for no other reason, that you have grown older). (c) If you replace one cash-value policy with another, the cash value of the new policy may be relatively small for several years and may never be as large as that of the original one. (d) You will be subject to a new contestability period. You should ask insurance agents for a detailed listing of cost breakdowns of both policies, including premiums, cash surrender value, and death benefits. Compare these as well as the features offered by both policies. If you decide to surrender or reduce the value of the policy you now own and replace it with other insurance, be sure that: (a) the agent making
It ALWAYS makes sense to shop around, and it may make sense to replace your policy if: • Your premium increases each year. Even though you are older now then when you first purchased your policy, a term policy with level premiums may be less expensive than the increasing term premium policy. It pays to shop. • Your original policy was issued at a higher rate due to health issues. Each company uses different underwriting guidelines, if you are with the wrong company you may be able to save. • Your health status has improved: If your health has improved through exercise, weight loss, better blood pressure or cholesterol control, etc. you may be able to obtain a better rate. • You quit smoking or changed your smoking habits. If you are a former cigarette smoker, you should definitely shop around for a better rate. As soon as you have been a non-smoker for 12 months or more, non-smoker rates are available to you. If you have always been an occasional cigarette smoker, there is now a compan
