Don’t Forget Your Annual Policy Checkup

Transcript of Podcast Episode 402

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: don’t forget your annual policy checkup!

When it comes to taking care of your family’s needs and helping preserve your wealth for future generations, life insurance may be one of the best tools you can use. It can provide cash to your heirs when it’s needed most, peace of mind, and flexibility, very often at a reasonable cost.

But no matter who you are, your needs and financial situation are going to be different and change over time. That’s why, just like a trip to the doctor, an annual checkup is so important. Procrastination is your enemy in either case. If you wait too long to address an undiagnosed illness or a neglected financial need, it might make the problem much more difficult to solve.

When it comes to life insurance, the older you get, the higher the premiums will become. And worse, an unexpected future health development could make it difficult or impossible to obtain new coverage when you need it. The sooner you can address any potential problem, the better.

Change can come at you in a hurry. Here are just a few of the life changes that might necessitate an adjustment in your life insurance coverage:

• Marriage – Either of you may want to help insure the income of the other
• New home – Many people choose to insure their mortgage; and some banks require it
• New children, of course, may increase your life insurance needs. The same also might apply for grandchildren.
• Divorce or a death in the family may prompt you to change your beneficiary.
• A change in your business fortunes and needs, either good or bad, may impact your life insurance.
• Growth in your income, or a change in your debts, may require you to adjust the amount of coverage you have.
• Policy performance is something that usually needs to be studied. Is your policy living up to expectations?
• Estate or inheritance tax changes could affect your insurance needs.
• Inflation, over the long term, can silently increase your life insurance needs.
• Your net worth. At some point, hopefully, your goals may evolve from merely protecting your family’s needs to creating a long-term legacy.
• Children growing up and starting families of their own may decrease your life insurance needs, but as we referenced grandchildren earlier, you may choose to provide for them.

So, you need to treat your life insurance much like you treat your own health: conscientiously, and with thorough evaluation. It takes effort. That means meeting with your advisor and getting a regular review, asking questions, and making adjustments as needed. Your future self—and the people who depend on you—will be glad you did.

When you go in for your review, you’ll need to take a good look at a few things with your life insurance advisor. You can start with some recent policy statements that show the current death benefit, cash value, and premiums due. You should also have your current overall financial statement and an accurate picture of your cash flow. This will be a good way to see if your coverage needs be changed. You will also need to be able to talk about any major life events that might have occurred since the last review.

Finally, your advisor will likely need to order a series of “in-force illustrations” on your policies. This will help provide a clearer picture of whether your current policies are performing as originally expected.

So, once you’ve gathered all the information, what exactly are you looking for? Over at LinkedIn, author Rick Bailey has a few suggestions, among them: [1]

• Is the policy’s death benefit still up to date with what you need?
• How about the premium? Can you still afford it?
• Don’t forget about the all-important beneficiary designations. Do subsequent events require some sort of change?
• Are there living benefits, such as a policy loan or chronic illness rider that you need to take a look at?
• Is the policy performing as it was originally intended? Will it require additional cash to keep it going?

So, it takes some work to get a clear and understandable picture of the policy and where it sits in your current situation. Is a policy change the best option? Perhaps a term conversion, Section 1035 Exchange, or even a partial surrender (if possible) might be a good choice.

An annual review is even a good idea with a term life insurance policy. The death benefit and premium might not change from year to year, but your health might, and your age definitely will. The closer your term policy gets to its end, the closer you may need to look at your conversion options because once the term is up, you’ll need to consider three things:

• Do I need to continue my term life insurance coverage for some reason?
• If I do need ongoing coverage, can I afford to pay the annually increasing term rates once the term is over?
• Is permanent insurance an option for me?

Has it been a while since your last policy review? Your Security Mutual Life insurance agent can help. Your Security Mutual Life insurance agent can help assemble your financial team and coordinate with your attorneys and tax professionals to review your situation, and to determine the insurance plan that will best suit your needs and objectives.

[1] Bailey, Rick. “Why Every Life Insurance Policy Deserves a Regular Review.” LinkedIn.com. https://www.linkedin.com/pulse/why-every-life-insurance-policy-deserves-regular-rick-lwdmc/ (accessed September 10, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares^®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

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