Should I cancel my Life Insurance Policy?

My dad started a life insurance policy for me when I was 16years old and when he died I took over the premium payments and changed the beneficiary to my husband now. I am still pretty young (under 30) and just bought a house, the policy is only worth $50K (the premiums have not surpassed the insurance amount). I'm starting to wonder if I really need this policy anymore b/c my husband and I are still young and if anything were to happen to me he could just sell the house and re-marry blah blah blah...and still survive on his own. Is it worth it for me to cancel this policy and save a couple hundred bucks a year and just worry about buying a new policy after I have kids or when I get older? Any advice is appreciated, thanks!

I'd keep it and get more. I'd be very concerned if I only had $50,000 on me.

It's hard sometimes to see past what we "could" do as opposed to what we "would" do. When the reality of a spouse's death sets in, the last thing on your mind is going to be selling the house and finding a new husband.

Just some thoughts,

-Joe

There are some advantages to keeping what you have. If you were to drop it and wait till you had kids to buy more, you might develop some condition that makes you uninsurable in the meantime (or take up skydiving). One thing you could do is look at term life insurance rates; in general, term insurance rates have dropped as mortality improves (although my life actuary friends tell me that's leveling out in the US due to our unhealthy lifestyles). You may be able to get a new policy for less money.

You also need to consider funeral and burial expenses if you go without coverage- not a happy thought, but many people are stunned to find out what the average funeral/burial costs are when a loved one dies and leaves no life insurance. And if you're a stay-at-home Mom, it will cost money to replace what you do every day. You wouldn't want your husband to marry the first bimbo who throws herself at him just so the house would be kept clean, would you? ;-)

One possible point in favor of dropping coverage- if you intend to keep working after you have children, most employers provide life insurance because it's a cheap benefit. Right now I think I have 3 or 4X my salary in employer-provided coverage. I never carried any additional coverage even when my son was younger (he's now 23).

No hard and fast answer here, but some factors to consider.

One thing you could do is look at term life insurance rates; in general, term insurance rates have dropped as mortality improves... You may be able to get a new policy for less money.


I would echo this statement and say that if you do decide to continue having insurance, you probably want to start getting some quotes for higher face amounts. You'll probably find that you can afford more insurance for the same money if you are healthy.

:)