Should I Cancel My Life Insurance Policy?

[BNTRS]

If you truly believe that you will be moving to a different country where you plan to buy insurance there (even if your time horizon ends up being a few years from now) and there's no plan to keep the current coverage you want then it makes perfect sense to cancel the policy. There's little benefit to keeping it, especially if it's a cash value policy as you will not have it long enough to reap the benefits from having it.

but...

The need for life insurance isn't likely gone. Buying a converitble term product to keep you covered until moving day is a great idea. (Note: converitble because just like this unexpected new situation proped up, other unexpected situations might come along, e.g. you don't move, you suddenly have a change in health (and a change in health doesn't always have to involve you, I could give you countless examples of people who went from super preferred to standard plus at most companies in the matter of day upon the--usually--unexpected passing of one of their parents or siblings), etc.)

You've paid a bit more than you necessarily needed to for the past couple of months. Cutting it off now rather than later will save money assuming things go as planned. Forget about cash value at this point.

Also NB: my somewhat cryptic wording is not intended to make you really second guess this decision. It's more a disclosure to cover my own ass in the event you take this advice and things work out differently and you get the brilliant idea to blame the fickleness of life on some guy who posted a response to your question on an internet forum. Recommending the cancellation of a life insurance policy is always a tough thing for us to do, from a liability stand point.

 

[fjman]

What country are you moving to?

 

[Franz Kafka]

Also, it would be cheaper if I get insurance from the country I would be living in and pay it in that country's currency as compared to having the policy that I have right now.

U.S. is the only country that I know that prohibits contestability of the death claim after two years. All the other countries that I know allow it and many claims do not get paid. When it comes to life insurance, American is the best. JMO

 

[Crabcake Johnny]

Health Ledger's estate reached an "amicable settlement" where apparently it's ok to lie on a life insurance application that you're a drug addict.

 

[Guest]

If a US company could prove fraud, couldn't they rescind the policy and refund premiums after 2 years? That's my understanding.

 

[Franz Kafka]

If a US company could prove fraud, couldn't they rescind the policy and refund premiums after 2 years? That's my understanding.

Well, you have to die.

As long as you're dead, they will pay.

I've had a client who passed away within days after the 2 years.

The check arrived in a week.

I also recommend that the OP lower his/her death benefit. JMO

 

[LGilmore]

Originally Posted by LGilmore

If nothing, then consider reducing the face amount of the policy to create a more affordable plan.
​

or....redoing it with a term plan..... "

Have you considered it may already be a term policy? He's a few years away from retirement and that premium is in the ball park for a lot of people around that age (std?)

In general another thing someone posted, and this is an assumption. It sounds like you're heading to Mexico or another low overhead country. BE sure of how insurance works in those countries as it may be completely different than here. Good luck and basically it sounds like you've made up your mind to cancel anyway. I hope what ever you decide on works for you.

 

[arnguy]

If a US company could prove fraud, couldn't they rescind the policy and refund premiums after 2 years? That's my understanding.

The short answer is yes, if they can prove fraud.

 

[AllenChicago]

DThur, do not cancel your current policy until you have a replacement policy in effect in your new country of residence. If you are not a citizen of that country it might be difficult to get coverage.

If that country allows, I suggest you speak with someone there and apply for your replacement coverage now...before moving. If you're approved and you're satisfied with the policy after you've received it and read it over, then, it's OK to cancel the protection you now have.

Good luck in your life after the USA DThur!

-Allen

I signed up for an insurance policy about three or 4 months ago with a premium of $205/month. However, recently, we have decided to retire early to another country, possibly at the end of the year or early next year. With this decision, I won't be able to afford my monthly premiums anymore as my income would be significantly diminished. My question is, should I cancel my life insurance policy at this point? What would be the repercussions? I want to be completely informed before I jumped on this decision. I hope people can help me.

Thanks.