Life insurance in your 40s

Your 40s can be a time of changing commitments and unexpected financial hurdles, making it an important time to keep life insurance on your radar, even if you already have a policy.

More and more people have young children while in their 40s. Regardless of age, new parents might want to consider buying life insurance to help protect their children financially, even after a tragedy.

If you already have a life insurance policy, but you purchased it based on your income and debts several years ago, your 40s may be the time to revisit your policy. Whether you've moved up an income bracket, expanded your family or acquired new obligations, now is a good time to purchase more coverage before you get much older, when your life insurance premium costs may be higher.

9 Things You Need to Know When Buying Life Insurance in Your 40s

1. It is not too late to get life insurance coverage if you’re in your 40s. Many insurance companies will sell term life insurance policies to people in their 40s, 50s and even 60s. If you want the lowest possible premium, you should consider buying now. Waiting even a few more years may end up costing you significantly more per month, depending on your overall health and your insurance provider.

2. There are several different types of life insurance on the market, but they all generally fall into the category of either term life insurance or permanent life insurance.

   Term life insurance tends to be more affordable, as the policies only last for a specific amount of time and expire at the end of your “term.” If you pass away during your policy’s term, and the policy is still in place, your beneficiaries receive a benefits payment.

   Permanent life insurance lasts your entire life as long as you continue paying your premiums in full and on time. Permanent life insurance policies are often more expensive than term life insurance policies because of the length of the policy and the fact that they accrue tax-deferred cash value over time.

3. Always verify the credentials of the insurance agent you choose to work with. Ensure they are licensed to sell policies in your state and research the financial stability of the insurance companies they are representing before agreeing to purchase a policy.

4. Make sure that the coverage is adequate for your family. In your 40s, you may have a mortgage or growing children who will need to go to college one day. Choose a large enough life insurance coverage amount to help pay for all of your commitments and to help provide for your loved ones until they can financially support themselves.

5. Insurance companies typically determine your premium based on your health history, occupation, hobbies and other factors. When filling out an application, be truthful with your answers. If you are caught intentionally hiding information, the insurance company may have the right to deny your beneficiaries the death benefit of your insurance policy.

6. Take advantage of the “free-look” period many companies offer after you purchase a life insurance policy. These periods typically last for up to 30 days, and you can cancel your policy and have your premiums returned if you change your mind during this time. This is a good time to review your life insurance policy details carefully and ensure it will meet your long-term needs.

7. Every policy has its own rules about what happens to your policy if you stop paying the premiums. Generally, your policy will lapse and you will lose coverage if you stop paying your premiums. Know your policy’s rules about lapses and ask your life insurance agent about your policy’s grace period and rules on reinstating coverage after a lapse.

8. If you own a life insurance policy that has expired, it may be more difficult for you to renew it as you get older. Many insurance companies might ask for a medical exam before deciding to renew your policy. If any illnesses are found, the company may opt to deny coverage or renew coverage with higher premiums.

9. In general, the older you get, the more expensive life insurance will be. If you shop around and compare quotes, you may still be able to find affordable coverage in your 40s.