Be careful. Replacing a policy can cost more and you may lose rights in your old one. Never cancel the old policy until the new one is in place.
A new policy can mean paying sales and setup costs again.
You are older now. If your health has changed, your new price may be higher, or you may not qualify.
A new policy starts new clocks. That can include a new two year suicide clause and new limits.
Ask your current insurer for an updated look at your policy. You may be able to change or add to it instead.
If you do replace, get a written side by side comparison. In many states you also get a longer free look period for a replacement.
- Keep your old policy until the new one starts
- Get a written comparison
- Watch for new surrender charges
- Ask about changing your current policy
More questions
Can an agent require me to cancel first?
Do not cancel first. Wait until the new policy is in force and you have read it.
Are seniors at more risk?
Yes. Older buyers should watch for large new surrender charges.
Are there tax issues?
Dropping a policy may have tax effects. Ask a tax pro.
Words to know
- Free look
- A short time after you get your policy when you can cancel for any reason and get a full refund. Texas policies give at least 10 to 20 days.
- Suicide clause
- In the first two years, companies usually will not pay the death benefit if the cause of death is suicide. The company returns the premiums instead.
