- Don’t rely on rules of thumb when deciding how much life insurance you need. Go through a detailed analysis of your needs.
- Evaluate who should own the insurance policy, which determines whether the proceeds will be subject to estate taxes.
- Select beneficiaries with care, being sure to name contingent or back-up beneficiaries.
- Before deciding on a specific type of life insurance policy, review all available options.
- Look for ways to reduce premiums by meeting certain criteria.
- Don’t purchase cash-value insurance unless you plan to own the policy for at least 10 years. It typically takes at least that long to generate significant cash values.
- Check the financial rating of your insurance company periodically.
- Don’t replace an existing life insurance policy without first evaluating the consequences of sur- rendering the policy.
- Review your life insurance polices every couple of years. Evaluate the policy’s performance and whether your needs and circumstances have changed.
