Do you need a second life insurance policy? Here's what you should consider

A life insurance cover with limited sum insured may be sufficient for a 30-year-old person, but it may not meet the additional needs and liabilities of the person who is 50. In such a case, an individual can buy a second life insurance policy.

While it is possible to claim two or more life insurance policies, it depends on the policyholders to decide if they want to take a second policy based on their insurance needs. Life insurance policies are taken keeping in mind not just the current situation of the family but also considering what the future entails. While in health insurance, the cover depends on the future medical costs, for a life insurance, the coverage estimates the value of the individual’s life. Hence, an individual should choose one or more policies in order to compensate the economic value of his or her life. A second life insurance policy helps in supplementing the coverage of the first policy. Apart from this, the policyholder can also rely on the second policy in case one claim is rejected.

With two policies, an individual can have separate maturity dates and use the sum assured to meet the changing financial needs at various stages of life. An individual can also opt for a policy based on personal milestones like marriage, children’s education and purchasing a house.

An individual planning to buy a second life insurance policy should inform the insurer of the other policy and the reason for choosing a second policy that they hold.

“It is advisable to have one term insurance plan and one additional policy to take care of the additional needs which come with increased lifestyle needs and added responsibilities,” Mint quoted Indraneel Chatterjee, co-founder of RenewBuy InsurTech, as saying.

Chatterjee also advised to refrain from applying to multiple insurers at the same time to avoid complications and to consult an insurance advisor to make sure that he or she gets the right policies as per their requirements.