Laura Berry is a former State Farm insurance producer and insurance expert.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com.

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Reviewed by Daniel Walker
Licensed Car Insurance Agent

UPDATED: Jan 10, 2017

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Don't miss these facts...

  • Yes, you CAN have more than one life insurance policy.
  • You need enough life insurance to cover funeral expenses, pay outstanding debts, educational loans and leave a little start-up money for your family.
  • You can obtain life insurance through places like banks, employers and insurance agents.
  • Term life insurance can be used to overlap in those years in life where more finances are needed if you die.
  • Get a quote from your current life insurance carrier on increasing existing benefit amounts.
  • Consider blending a whole life policy with term and stick with a realistic amount your family will need.

Is It Legal to Have More Than One Life Insurance Policy?

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Yes, anyone can have more than one life insurance policy with one or multiple companies. There are no laws or regulations that say how many life insurance policies one person can have.

There will be a moment that an insurer will start to ask questions if you are taking out amounts that are simply not needed.

Life insurance is designed to keep families from suffering financial loss in the event you die, but taking out a $2 million dollar policy when you bring home $38,000 a year might raise an eyebrow or two.

It can be wise to layer your life insurance policies during periods in life when money matters most, such as having children in the home or any other dependent that requires care.

Having a parent or grandparent in the nursing home is a good example. You need to take these expenses into consideration when calculating how much life insurance you actually need.

Learn more about multiple policies below and don’t miss out on our free quote tool above!

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How Much Life Insurance Is Needed?

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The amount of life insurance needed will depend on many variable factors.

You need to take into account the lifestyle that your family is accustomed to living, all outstanding debts, how many dependents are supported by your income and many other specifics.

A few of them are:

      • Your age
      • Quality of your health
      • Dependents that rely on your income
      • Mortgage
      • Car loans
      • Educational loans
      • Credit card debt
      • Personal loans
      • Funeral expenses
      • Support for children under age 18

Multiple Sources of Life Insurance

You may have a life insurance policy that pays a beneficiary upon your death and are completely unaware. There are some instances where an insurance policy is taken out to protect a lender in the event you die before paying back a loan.

There are also times that you are offered life insurance and might even forget that you have it. There are some banks that allow a small death benefit built into the account you initiate.

Many employers offer group life insurance coverage for a small payment.

There are also many companies that offer individual life insurance products of all types. The price will be higher as an individual, but you can get exactly what you need. The younger you are and healthier the lifestyle, the better the rates will be.

Overlapping Term Life Insurance

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Term life insurance is a guaranteed death benefit insurance that is good for a specified amount of time. It can range from 5,10,15,20 or 30 years.

It is not uncommon for people to purchase multiple policies to adjust to increased needs during specific parts of life that require more cash.

When you start a family your concern will settle on how a surviving spouse will finish raising the kids, send them to college and off to a great start in life.

It is not uncommon for people to purchase multiple policies to adjust to increased needs during specific parts of life that require more cash.

When you start a family your concern will settle on how a surviving spouse will finish raising the kids, send them to college and off to a great start in life.

Getting older is a concern as well. Health problems are more likely to come up. A serious illness that ends your life will leave family behind with what could be astronomical medical bills.

You can overlap additional coverage as needed for a short or long-term period of time. You do not want to end up

You do not want to end up over-insured to a point that an excessive amount of income is being spent on premiums.

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Get a Quote for Increasing Your Existing Life Insurance Policy

Buying additional life insurance from your current insurance source will most likely get you a better rate, but be prepared to shop around. Check reviews for any insurance company that you have dealt with before.

Some have much better ratings than others when it comes to denying claims and showing bad faith to their consumers.

If you have an existing policy, see how much it would be to simply increase the amount of death benefit it offers. It will save you time and money.

Stick With the Amounts You Need

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Life insurance premiums can get expensive if you are not carefully planning for what you really need. The thought of leaving each child a million dollars might be nice, but is it practical?

The cost of one million dollar policy is not a small monthly payment.

Instead, take a realistic look at what it will take to ensure there are no major debts left behind and that there are enough funds to allow your family time to adjust and move forward.

Combining Term and Whole Life Products

Whole life insurance policies can remain in effect your entire life, as long as you keep the premiums paid up to the maturing date. These often pay more than the death benefit because a portion of the premiums are invested.

You can take loans against the policy, but it may be subject to taxation. Borrowing too much can result in having the policy canceled. It is a great tool to use towards retirement savings.

Combining a smaller whole life policy with larger term life will result in a more affordable way to leave your family financially healthy when you die.

There are no limits to the number of whole life and term products you can get, but make sure you are able to handle the premiums of all products combined.

Having multiple life insurance policies is one of the most affordable ways to make sure that all your debts and obligations are taken care of when you die. Sit down with a qualified insurance agent and discuss how to satisfy your life insurance needs.

Make sure you take advantage of our free quote tool below and start comparing rates today!

References:

  1. http://www.tdi.texas.gov/pubs/consumer/cb018.html
  2. http://www.investopedia.com/financial-edge/0311/are-you-over-insured.aspx
  3. http://www.investopedia.com/articles/pf/06/insureneeds.asp
  4. https://www.moneytips.com/multiple-life-insurance-policies-101