As a newlywed, there are a lot of financial changes you must get ready to embrace. And while some of these changes are pretty straightforward, others—like how to handle your life insurance coverage—are a bit more intricate.

Who will be Your Beneficiary?

A beneficiary change may be in order for some newlyweds who already have in-force life insurance policies. And those who don’t yet have policies need to decide whom to name as beneficiary once they do. Generally you want to avoid naming your estate as beneficiary since that move will force your life insurance death benefit to be put through probate and, as a result, your heirs will face delays in receiving the benefit. Instead, you can name an individual (such as your spouse) as your beneficiary, divide the death benefit between multiple beneficiaries, or name a revocable or irrevocable trust.

Evaluating Policy Ownership Options

When you buy a life insurance policy, you do not have to be the owner and the insured. Instead, you can name your spouse as the owner or name a trust. It is important to remember that the owner of the policy can make any changes to the policy that they want; they can change your beneficiaries and reassign ownership with no say from the insured. 

Choosing between Term and Whole Life

If you don’t already have insurance, or you need an additional coverage for a temporary period (such as during the term of your mortgage), then you need to decide whether you want whole or term insurance coverage. Whole (or permanent) life insurance is guaranteed to pay out your death benefit anytime your death occurs, as long as you make payments on time. Term insurance pays a death benefit only if death occurs during a certain set of years. Additionally, term insurance does not accrue cash values.

Spouse Rider or Separate Policies?

If you and your spouse must buy insurance, you can each have your own policy or you can buy a policy to cover one of you and add a spouse rider to cover the other. This decision is important because while spouse riders might be less expensive than individual policies, they can also be restrictive in the death benefit amounts. Also, with a spouse rider, the rider’s benefit is only payable if the insured on the rider predeceases the insured on the base policy.

There is no question that life insurance is a necessary product for all newlyweds to carry. How you decide to structure your policy will depend on your unique needs and situation. Make sure you evaluate all your options and settle on a policy structure that is both affordable and efficient.

Make sure your Regina Life Insurance is with Heritage Insurance so you have one less thing to worry about.

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