Some people don’t have any life insurance. Others decide it’s worth having and take out a policy. But can you have more than one life insurance policy?
That may seem like a strange question, but it’s actually a fairly common one. Below, we answer the question and provide some other helpful information why having more than one policy may make sense.
Can You Have More Than One Life Insurance Policy?
Well, the answer to that question is yes. You can have more than just one life insurance policy at a time. It is completely legal and there is nothing preventing you from having more than one policy if you so choose..
There are many people who have two or more life insurance policies.
The most common situation is the following.
You work for a company that provides some life insurance coverage for its employees. That’s great, but maybe the policy doesn’t cover all that much and you want more protection for your loved ones.
In this case you may decide to buy your own personal policy. And, again, that’s totally up to you to do if you want.
Even if you don’t get life insurance from your employer, you still have the option of purchasing multiple life insurance policies from different life insurance companies. Maybe you have a term life policy from one company. Then you decide to add a whole life policy from another.
If you do want to get more than one policy, most of the time you will be asked about your current policy’s coverage. This is because the life insurance company wants to make sure that the amount you ask for is reasonable. If you try to take out what they consider too much coverage, it may raise some warning flags.
Why Would You Need Multiple Policies?
There are many reasons as to why many people want to buy more than just a single life insurance policy. Here some of the reasons why:
To Replace Income
The most common reason is they want to make sure their dependents are protected from financial problems if they pass away early. More policies means more financial resources for their loved ones.
Additional Coverage at a Lower Cost
If you already have a policy, it may cost a lot to increase the coverage on that existing one. By a second (or more) life insurance policies, you can often save a lot of money over trying to increase coverage on your current policy.
You Do Not Want To Risk With A Single Policy
Even though it is rare for a life insurance company to go out of business, it is still possible. And some people do not want to take that risk.
Having multiple life insurance policies can serve as a backup in case one goes away for whatever reason.
Small Business Needs
Having more than just a single life insurance policy can protect not only your dependents such as family, but also your small business. Another life insurance policy can help pay for business loans in case of an untimely death of the policyholder.
So those are some of the reasons why it is recommended to have more than just a single life insurance policy.
In conclusion, yes, you can have more than one life insurance policy. And there are a number of good reasons why you may want to do that.
