Life Insurance Audit Guide: Easy Ways To Audit Your Life Insurance

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Last updated on: February 22, 2019
life insurance audit

A life insurance audit is a lot more than just an evaluation. It is a comprehensive process by which you can evaluate your current life insurance coverage, it’s price, and check to see if your life insurance plan meets your current requirements and budget. It should be done at least once every 2-3 years.

A life insurance policy can help protect your family from financial losses in your absence. At the time of a claim, the money is given to the beneficiary of the policyholder. Some life insurance plans also offer investment benefits on the maturity of the policy period. There are different types of life insurance. Term life insurance and Permanent life insurance are two examples. You should choose the one that best suits your needs.

Here are a few questions to consider:

What is an insurance audit?

An insurance audit is the examination of your life insurance coverage to make sure that the current insurance policy meets your insurance needs. It is very important to conduct an insurance audit at regular intervals.

Why is life insurance audit recommended?

Our needs and requirements change over time. That is why an insurance audit is necessary to monitor your insurance needs and requirements. New insurance products are being launched all of the time and some new products may better match your existing insurance needs. An insurance audit provides a detailed review of the insurance coverage options so that you can choose the most suitable policy. It can also help you to find the missing coverage options in your existing insurance policy.

An insurance audit can sometimes help lower your insurance premium and provide higher death benefits.

So, how do you complete an insurance audit?

Let’s take a look at some of the ways you can audit your insurance.

During an insurance audit, you need to ask yourself certain questions regarding your insurance needs. The answer to these questions can help to determine if you need a professional advisor.

Key questions you should ask yourself during an insurance audit (guide):

Are your existing policies valid?

You should know if your existing policies are still active. You should also check whether your nominees/beneficiaries are stated correctly on the policy.

What is the purpose of your current life insurance policy?

The purpose of your current life insurance policy should be very clear in your mind. If you are not clear about the purpose, you need to take a closer look at your current insurance policy.

Did you purchase the coverage option at the best price?

You need to research thoroughly and find out the available rates for the Term life insurance or Permanent life insurance. This will help you know whether you are spending the right amount on your life insurance.

What is your insurance coverage?

You need to check that you have the right coverage according to your requirements. You should know whether you are under-covered or over-covered.

What are your goals and priorities regarding your family?

This question helps you to analyze your future goals and priorities and will help you make the best plans for your family. It includes the monetary support you want to provide to your family in your absence. It will also help to identify whether your current insurance for life is sufficient according to your requirements.

Do you need additional coverage options?

You should evaluate whether or not you need additional riders with your insurance policy including disability, accidental death, etc. They may provide additional benefits your family may need.

Are my insurance estimates correct?

When you are planning your insurance needs, check your finances, review your key expenses, and adjust your insurance policy as needed from time to time. An insurance audit and making timely modifications in your life insurance plan according to the changes in your family and lifestyle can help you ensure your family will be provided for in the event of your absence.

These are some of the important questions you should consider when you are conducting a self audit.

Alchemy Insurance is an insurance agency in Oxford, PA with more than 30 years of experience searching for, and connecting individuals, families and businesses with well-known insurance brands and coverage. We can help you get the best insurance plan based on your lifestyle. Our professionals will carry out a thorough research and help you choose the most suitable and affordable insurance plan.

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