When should a complete insurance review be conducted?

Conducting a complete insurance review annually or after significant life events is essential for ensuring that an individual's insurance coverage aligns with their current needs and circumstances. Life events such as marriage, the birth of a child, a change in employment, or significant financial changes can drastically alter one’s insurance requirements. An annual review allows for a timely assessment of policies, ensuring that coverage is adequate and that beneficiaries are up to date.

Regular reviews help identify any gaps in coverage or excess premiums being paid for unnecessary policies. They also allow for adjustments in coverage amounts to reflect changes in income, assets, or liabilities. By committing to this practice, individuals can avoid underinsurance or overinsurance, both of which can have financial consequences.

While reviewing insurance every two years might seem adequate, it does not take into account the dynamic nature of life situations and market changes that can affect insurance needs. Similarly, only evaluating insurance when taking out new policies misses the opportunity to reassess existing coverage for ongoing relevance. Monthly reviews would likely be excessive and impractical, leading to financial and mental strain without significant benefit. Thus, the approach of conducting an annual review or following significant life events is the most balanced and effective method for maintaining appropriate insurance coverage.