ACLI is the American Council of Life Insurers - a unified voice that expands awareness of how the products offered by life insurers help Americans plan for and achieve financial and retirement security.

The following article was produced by the ACLI:

Have You Reviewed Your Life Insurance Policy Lately?

Once you have purchased life insurance, it's tempting to file your policy away and forget about it. But it's vitally important for you to review your policy on a regular basis - especially as the circumstances of your life change. This may save a lot of heartache further down the road.

Events such as marriage, divorce, the purchase of a home, a significant increase in income, the birth of a child or the death of a loved one all can influence how much financial protection you and your family need or how you want your estate divided after your death. Many people change their wills in such situations, but all too often neglect to update their life insurance coverage.

You want to be sure that the amount of your coverage is adequate to meet your current financial obligations and your loved ones' continuing financial needs. You must also make sure that your desired beneficiaries - the people you want to receive benefits from your life insurance policy when you die - are the people actually named on the policy. If your policy is not up to date, your policy benefits may not be distributed as you intend.

For example, imagine these scenarios:

• You have listed your two children among your beneficiaries. If you have another child later in life, that child will not be entitled to benefits unless you call the insurance company to add his or her name to the list of your beneficiaries. If you die without updating the policy, your older children will receive their designated benefits, but the youngest will not be entitled to any benefits at all.
• Several beneficiaries named in your policy are the breadwinners for their families, and your intent is that the benefits they receive from your policy will help support their children. But one of those beneficiaries dies before you do. That share of the benefits will not pass along to his or her children, but instead will be given to the other beneficiaries named in your policy, unless you have the policy changed to specify otherwise.
• You were married when you purchased your policy and named your spouse as a beneficiary, but you have since divorced. Although a few states have laws to ensure that an ex-spouse will automatically be removed from a policy in the event of a divorce, most states don't. Your ex will remain a beneficiary unless you contact your insurance company to make the change. Likewise, if you remarry, you must add your new spouse as a beneficiary.
• Your parents are getting older and are beginning to rely on you for financial support. If you don't add them as beneficiaries in your life insurance policy, your premature death may deprive them of the financial resources they need.

The above list does not include all situations that should prompt you to review your policy - any change in your family, your job, or your financial situation presents an occasion for a re-evaluation. Even if a year goes by without any major life changes, it is still a good idea to look over the terms of your policy again. Your financial circumstances may have changed. Perhaps you got a substantial raise or a pay cut. You may have paid off your mortgage - or gotten a new, larger mortgage. Perhaps one of your children makes it into a grad school with hefty tuition. Or maybe your children are now earning their own salaries and are no longer dependent on you. As your financial situation changes, your financial protection needs change - and it is up to you to adjust your coverage accordingly.

You should review your policy once a year to make sure it meets your current financial protection needs and that it is clear and specific about beneficiaries. Put it on your calendar, or make it a routine part of your annual financial checkup. Life insurance is one of the simplest and most powerful forms of financial protection. To ensure maximum protection for you and your loved ones, it's vital to keep your policy up to date.

End of Article

Also check out the ACLI's consumer publication "What You Should Know About Buying Life Insurance" (PDF). Call your agent or contact GILICO's Policyowner Services Department at 1-800-535-8110.