Issue link: http://clhia.uberflip.com/i/405151
28 1. Have a clear picture of your insurance needs and objectives. Work through an updated financial needs analysis. Consider the budget you have to meet those needs. 2. Review your current policy. If it no longer fulfills your needs, could it be altered to do so? If you have dividend options in an existing permanent insurance policy, can you use them to increase coverage? Don't hesitate to ask your existing agent or insurance company for help with this review. 3. Be aware of the pros and cons of both your current and proposed policies: • Do you fully understand the values of your current policy (guaranteed values, accumulated dividends, future values)? • Are you losing tax advantages or creating a tax liability if you change plans? • What are the cost implications of being older today or perhaps not in the same health as when you took out the policies? What evidence of insurability is required on a new policy? • Are there circumstances where your new policy does not pay benefits (e.g., a new two-year suicide provision)? (See page 35.) • If the new policy is term, is it guaranteed renewable and convertible to another type of policy without evidence of insurability? • Are premiums guaranteed? If not, when would they increase? What is the maximum level to which they could rise? 4. What are the professional qualifications of the agent(s) involved? What level of service and commitment can you rely on? Will the agent get a commission on the new policy? 5. If you decide to go ahead with a replacement, the agent recommending the replacement must complete a Life Insurance Disclosure Form. It's intended to help make you fully aware of the pros and cons of both policies. This form must be properly and fully completed. Read it carefully before signing. Should You Replace A Policy? Some Considerations TIP: Make sure that the new policy is issued and in force and that you review it carefully before you request termination of your old policy. Termination requires a written request from you. The Life Insurance Disclosure Form cannot be used for this purpose. SECOND THOUGHTS