​Approaching retirement? If so, you may be in the process of evaluating your financial strategy and making adjustments. Perhaps you’re making changes to your investment portfolio or developing a retirement budget. Maybe you’re planning on when to file for Social Security or whether you should work part time in retirement. The years before retirement are often a busy but exciting time.
 
You may want to review your life insurance policies as part of this strategy. If you’re like most people, you’ve acquired various policies over the years. Many people purchase life insurance to protect their spouse, kids and other loved ones in the event of their death.
 
In retirement, you may feel like you no longer need life insurance. In fact, many retirees cancel their policies for a variety of reasons. However, there may be good reason to keep your life insurance or even increase your coverage. Below are two common reasons why retirees ditch their life insurance, and why these reasons may not be correct. If these ideas sound familiar, you may want to reconsider.

If my kids are grown, why should I own life insurance?
 
Many people buy life insurance primarily to protect their dependents. What happens, though, if you no longer have any dependents? If your children have grown and moved out, you may be in this position. If you’re an empty nester with significant assets and little debt, life insurance may seem unnecessary.
 
However, you may not want to cancel those policies just yet. Life insurance can still serve a useful purpose in retirement, especially if the policy has accumulated cash value. You can use that cash value as an emergency reserve or supplemental income source. You may even be able to take tax-efficient loans or withdrawals from the policy in retirement.
 
You can also redirect the purpose of the death benefit. Just because it was originally intended to protect your young children doesn’t mean it has to stay that way. Consider using the policy to fund college for your grandchildren or to leave a charitable legacy.

I have plenty of retirement assets so I don’t need life insurance.
 
If you’ve been saving for retirement for several decades, you may currently have more assets than you’ve ever had in your life. Surely those assets will be sufficient for both you and your spouse. If that’s the case, there’s no need to leave life insurance for your spouse, right?
 
Not necessarily. Retirement can span several decades. It’s very possible that your assets may not last as long as you expect. You may spend more than you’d planned, or the financial markets could take a downturn. You may face significant medical and long-term care costs in the final years of your life, and those costs could deplete your assets.
 
Life insurance gives your spouse a boost in assets upon your death. He or she can use that money to fund living expenses, provide gifts to family or pay for his or her own long-term care. If you pass away relatively early in retirement, your spouse may need to support himself or herself for many more years. Life insurance could help your spouse overcome that challenge.
 
Ready to review your life insurance as you head into retirement? Contact us at Rex Financial Group for more information. We can help you analyze your policies and your needs and develop a strategy. Let’s connect soon and start the conversation.
 

Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
17965 – 2018/9/4

​Are you in the process of purchasing life insurance for the first time? Feeling overwhelmed by the application process? If so, you’re not alone. Life insurers use a process called underwriting to determine the amount of risk involved in each policy. Essentially, insurers estimate the odds that they will have to pay the death benefit, as well as when that may happen. In other words, they want to predict when you may pass away. While that thought may seem morbid, it’s an essential part of determining a policy’s premiums.
 
The underwriting process is based on a variety of factors, including your gender, age and health. The insurance company uses a range of tools to gauge your health and factor it into its premium calculation. Below are a few questions and answers about underwriting and how you can score the best possible health rating:

What is underwriting and why do they need my health information?
 
Your health obviously plays a major role in your life expectancy. Consider that two people of the same age could have very different life expectancies based on their health. If one struggles with weight, high blood pressure, chronic illness or other issues, he or she may have a shorter life expectancy than the other.
 
In that case, the life insurance company may feel that it will pay the death benefit for that person relatively soon. Thus, it gives the less healthy individual a lower health rating and a higher premium amount.
 
Conversely, a person who’s healthier than the average individual the same age may score a much better health rating. The insurer may feel that person represents a lower risk and thus offer a discounted premium.

Why do I need to take a medical exam?
 
The life insurance company gauges your health by collecting information. The most basic form of information is your application and a health questionnaire about your medical history and your family history. If you are relatively young or applying for a low death benefit amount, this may be the only required piece of medical information.
However, most applicants will at least need to take a medical exam. These exams are usually conducted by nurses and performed in your home, office or other convenient location. The nurse measures your height, weight and blood pressure, and also takes blood and urine samples. The whole process often takes a matter of minutes.
 
If you are applying for a significant amount of coverage or have a history of health issues, you may need a more thorough exam. The insurer could ask for a full physical, a stress test or more. The specific information requested largely depends on your unique history and health issues.

What other factors could influence my rating?
 
Lifestyle factors can also impact your rating. One of the biggest is the use of tobacco, alcohol or drugs. The difference in premiums for a smoker versus a nonsmoker can be significant. If you’ve ever considered quitting smoking, you may want to do so in the months ahead of your life insurance exam.
 
Some insurers also look at risky activities such as sky diving. You likely won’t be declined for participating in these activities, but you could see an increase in premiums. However, your financial professional may be able to look for insurers that aren’t as prohibitive in this area.
 
Ready to find the right life insurance policy for you? Let’s talk about it. Contact us today at Rex Financial Group. We can help you analyze your health, lifestyle and goals, and then develop a strategy. Let’s connect soon and start the conversation.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
17965 – 2018/9/4