You only live once, but let's say you need to insure that one life many times? It can be done, but there are limits.
Let's discuss the advantages and disadvantages of having several life insurance policy:
Consider your total coverage amount
The reason for life insurance coverage would be to replace lost income, not to generate new income, so companies try to ensure you aren't overinsured which the value of your policy pertains to your earnings.
If you've life insurance and are considering taking on a new policy, an insurer will consider the worth of all of your existing policies. For instance, if an individual would qualify for $500,000 of coverage and already has $100,000 of coverage with Company A, Company B will most likely approve them for any maximum of $400,000 of coverage. Another reason behind this (along with avoiding overinsurance) is the fact that life insurance coverage companies need to make sure their clients will pay the premium. If an individual has substantial life insurance coverage with little relation to their salary, there's a danger their premium could be greater than they can afford.
What to know about replacement policies
If you need to replace one policy with another, instead of purchasing additional coverage, things obtain a little more complicated. To understand all about it, click here. The end result is that replacement is really a somewhat bureaucratic process, and at the moment Haven Term life insurance policies from MassMutual cannot be accustomed to replace policies from other insurers (though they may be purchased as additional coverage). In the future, Haven Life intends to provide the choice of replacement coverage to customers.
Although you could have multiple life insurance policies from multiple carriers, you are able to have only one Haven Term policy at any given time, and you can't increase the quantity of coverage later, so it's best to make sure you get the total amount suited for you at the outset. Luckily that's very easy to do if you use the Haven Life Insurance Calculator that will help you figure out your lifetime insurance needs.
Understand how group life insurance coverage works
One common scenario by which people have multiple life insurance policies happens when they've coverage using their job, in their benefits package, in addition to a policy that belongs to them. Coverage from work, known as group life insurance coverage, is often cheap and worth getting, but it's worth noting that it may be insufficient on its own.
For example, if you're offered life insurance equal to one year's salary out of your job for a small annual payment, go ahead and take it, but consider these two points:
- The amount of coverage from group life insurance coverage might not be enough to satisfy your family's needs should you die.
- You may not be able to take that group life policy along with you should you leave your job, or it may be prohibitively expensive for do so.
If this is the case, you should consider getting a life insurance coverage of your own in addition to employer-provided group life insurance coverage.
You can have multiple life insurance coverage, but why?
So you can have multiple life insurance policies: The question is, would you like them? It truly depends upon how you enjoy spending your time.
Applying for term life through Haven Life is simple and easy, but that is not necessarily the situation at other life insurance coverage agencies. Also, even when getting life insurance coverage is quick and easy, how often do you want to do it?
If you're considering life insurance coverage the very first time, it is best to choose the best quantity of coverage at the start, especially because this enables you to lock in a rate while you're young, healthy and relatively cheap to insure. If, on the other hand, you already have coverage but require more, now is the time to buy it: Life insurance cost less now than it has ever been, and rates will probably increase while you age.