What is My Insurance Policy Worth?

Tips on how to combat rising life insurance costs

For a good portion of Americans, life insurance is a critical component of financial planning. However, in recent months, many seniors have been hit with an unwelcome surprise as several insurers are raising the premiums on their life insurance policies.

When a life insurance policy becomes too expensive to maintain due to premium increases, the owner can be faced with some difficult decisions.

Consider this story: A 75 year-old man owned a Universal Life insurance policy with a death benefit of approximately $500,000, which he purchased to provide income for his wife in the event of his death. Unfortunately, a battle with prostate cancer dealt him a financial blow and the low interest rates took a toll on the cash value in his policy. Then came the sucker punch: the life insurance company was raising his premiums to almost twice what he had originally planned.

He was told that he would receive just $1,006 in cash surrender value from the insurance company. Instead…