Upon delivery of your life insurance policy, your life insurance agent should go over the key components. FSCO also recommends you review your life insurance policy carefully by yourself. It is a complex document with many pages and terms, but here are eight tips to help you break it down.
Familiarize yourself with the structure: your policy should have a cover page or
declaration page (this contains basic information like your name, address, policy dates, insurance company contact information, and key details of your policy), a list of terms or definitions found in the policy, coverage details,
exclusions. Any policy illustrations previously discussed should also be attached. Remember policy illustrations are estimates – there are no guarantees. In most cases, your application should also be attached.
Check the accuracy of all information: names (including correct spelling), contact information, the duration of the policy,
premiums. Check the information against your policy application to ensure all information is captured accurately. Remember that misleading or mistaken information can invalidate your policy and
Verify the death benefit is what you asked for: if it is not, contact your life insurance agent or company. Remember the policy illustration attached to your policy is an estimate.
Review the riders and exclusions: if you requested certain riders, make sure they are represented correctly. Be aware of any
exclusions in your policy: there are certain risks that your insurance company will not cover.
Understand the different types of coverage and the terminology: your policy should have a list of definitions written in plain language that you can understand.
Review your rights and privileges: as a consumer you have the right to cancel the policy within 10 days and in some cases 20 days. You may also have the right to convert your term policy into a permanent policy when it expires.
Review the settlement options: be aware of how to process a claim and how your money will be distributed. Tell your beneficiaries who to contact in the event of your death.
Ask questions! If you see anything that you don’t understand, ask your life insurance agent or company, or if your life insurance is through your employer, ask your human resources representative for clarification right away. If you are not content with the response, ask for a written explanation. If you see anything that is wrong speak to the insurance company. It is your responsibility to make sure you understand what you are buying and to ensure that everything is correct.
You may be interested in...
Working with a Life Insurance Agent or Company: learn more about your agent’s responsibilities and how they can help you.
Life Insurance 101 Getting Started: make sure you understand the terminology in your policy.
Types of Life Insurance: make sure your policy is the right one for you.
Shopping for Life Insurance: get details on how to select an agent and how to comparison shop for life insurance.
Financial Literacy Portal: learn more about a variety of financial topics.
Glossary: Life Insurance: to better understand common life insurance terms, refer to this glossary.