The ‘future insurability’ feature of most life insurance policies gives you the ability to increase your level of cover without having to provide any medical evidence. If you’ve taken out a OnePath Life policy through an adviser #, you are able to do this every three years, or every 12 months if a major life event occurs such as:
- Marriage or divorce
- Becoming a parent or carer
- Increasing your mortgage
- A salary increase of 15% or more
- An increase in the value of your business.
How much can I increase by?
Policies with different insurers may differ, but with most policies insured with OnePath Life you can increase your cover without medical evidence by up to 25% of the original amount insured, or $200,000 (whichever is less), for each major life event, also known as a ‘trigger event’ (eg. marriage, divorce, retirement etc.).
So if you started with $500,000 of cover, you could potentially increase your cover by up to $125,000 per trigger event– simply by filling out one short application form and providing proof of the trigger event (e.g. marriage certificate).
Over time you can potentially use this feature to double the amount of your original sum insured, capped at $1 million overall.
You should bear in mind any increase in your cover will increase your premium, which is something your financial adviser can help you balance.
What if I need a bigger increase?
Your financial adviser can help you work out how much extra cover you need and generate a quote for you on the spot. If your increase is bigger than what’s allowed through the future insurability feature, you may need to do some medical checks.
What if I need less cover?
Just as your cover needs can increase as your life changes, they can decrease as well – e.g. as you pay down your debts or your children get older and become financially independent. That could mean you’re paying for cover you don’t need.
That’s another reason why it’s a good idea to review your cover with your financial adviser every 12 months – or when major life events occur – so you can make sure you’ve got the right level of cover, all of the time.
# The increased cover may be accident only for a certain period, check your policy’s terms and conditions for full details.
Disclaimer: The information contained in this article is general in nature and does not take into account your personal objectives, financial situation or needs. Please consider whether the information is appropriate to your circumstance before acting on it and, where appropriate, seek professional advice.