Coffee heat rising

5 Reasons you may not Have Enough Life Insurance Coverage

Hopefully, you have life insurance. Having a proper policy in place is an excellent way to protect your loved ones against the unknown. Life has a way of throwing some crazy things at you.

Unless you can predict the future (and if you do, let us know), then you should have a life insurance to protect your family’s finances.

If you already have a plan, you need to take a long look at your insurance coverage. Sadly, you may realize you don’t have nearly enough insurance. Let’s look at some of the reasons why you might not have enough insurance.

Even if you don’t like math or thinking about your passing (and who wants to?), don’t worry, it’s not going to be complex math. Looking at these categories is one of the most important things you can do.


Having children is one of the most common reasons people get life insurance coverage. When a couple has their first child, they tend to purchase a term life insurance policy, but they don’t let their policy grow as their family does. If you bought your life insurance many years ago, you might have had more children since you purchased it.

The more children you have, the more life insurance coverage you need. If you’ve had more children, look at your life insurance to ensure they will have the coverage they need.

Job Promotion

One goal of your policy is to replace your paycheck if you were to die. If you have people who need your paycheck, like a spouse or a child, then make sure they have the money they need to replace the income.

If it’s been several years, you may have gotten several pay increases or job promotions. The more money you make, the larger your life insurance you should buy to replace your stream of money.

Your plan should be big enough to replace your paycheck for at least 5 years. Preferably, it will be able to give your family seven to ten times your annual income.

New House

Your mortgage is your biggest expense. If you have a mortgage loan, it’s probably the biggest bill you have and will ever have.

You don’t want to think about passing away, but if you did, your spouse is still going to have to pay for your mortgage bill. They would only have one income, but if they have your life insurance money, they can pay off your mortgage bill.

You might have owned a smaller home when you originally purchased your life insurance plan. If you’ve moved into a larger home, you have a larger mortgage. Make sure your plan is still big enough to cover those expenses.