When is the last time you did a review for your insurance policies?
If you have been trying to avoid such reviews for your insurance policies, there are actually some benefits (I have 5) you can gain from it.
1. You May Get To Save Money
We are currently living in a time era where policies can be confirmed and bought over the phone and even through leaflets. Plans like Personal Accident Plans are of such.
I recently met up with a client and after going through his policies portfolio, he had taken around 3 -4 personal accident plans (with 95% similar features) through telemarketers from the banks, even signing up through a brochure sent to his mail. He was spending around $200 per month on them.
Personal Accident Plans are a must-have but not too many and especially when other areas of concern (critical illness, medical insurance, children’s university education) are not taken care of yet.
Doing a policy review helped him to remove some of these (similar) plans and free up more budget!
And that will bring us to Benefit #2.
2. You Get To Address Your Real Concerns
A policy review is not all about the financial planner promoting the latest promotion for his insurance products. Rather a policy review is about knowing whether you have addressed your actual concerns.
The client that I have mentioned above has too many Personal Accident Plans and too little critical illnesses coverage. After he understood the impact of suffering from any critical illnesses and knowing that a Personal Accident Plan does not cover him for that, this became an actual concern to him.
So that policy review became a chance for him to remove most of his Personal Accident Plans and divert the savings into getting a Term Insurance.
3. You Get To Familiarize With Your Insurance Policies
Do you know that most people do not know what insurance policies they have gotten?
That’s why a policy review will do you good because you get to know what you are being covered and what you are not.
I had previously attended a walk-in customer who realized he had bought a hospital benefit plan way back (after I did a review for him) and there was a time (2 years back) that he was really hospitalized of which he paid quite a huge bill amount.
Though he had kept the receipts, he was unable to make a claim because the policy documents stated that any claims have to be made usually within 30 days upon happening else it will become invalid.
Though at the end of the day, he can only grumbled that he had paid the premiums for the plan for nothing and yet unable to make a claim, at least he still know that he is covered in an area that he is most concerned after the review.
4. When You Need Cash, You Can Turn To Your Insurance Policies
A policy review can give you a clearer picture in terms of the current cash value of your insurance policies.
There was a time I need some urgent cash and instead of turning to relatives, friends or even the bank (and suffer from the high loan interest rate), I turned to the cash value from my insurance policies because i know that it is enough at that point of time to tide me over.
5. You Get To Understand How Your Investment-Savings Are Doing
Knowing the value of the cash values of your plans, you can also get to understand if your policies are giving you a good return (as compared to the values projected over the benefit illustration). This is especially good-to-know if you have taken up any investment-linked plans.
Such a policy review can help you to make a decision of whether you need to make any changes to the funds. Making the necessary changes now then later will help to ensure that your objectives (e.g. retirement planning) will be achieved.
And these are my 5 benefits that you can get out from a policy review.
So if you have not done your insurance policies review today, don’t you think it’s time to do one now?
*above images courtesy of http://www.sxc.hu