In the management of life insurance policies in order to maximize benefits for the insured the first thing you should do is to conclude and review your policy. This will let you know what we do and what protection is there, and coverage or various benefits Received from the policy that has been made consistent with the current desired financial goals or not. In order to modify the policy accordingly and in accordance with current needs as much as possible. Because if found to be insured too much May consider stopping paying certain insurance policies to reduce the burden or if doing too little Will consider adding in the lack of.

In addition, if there is a financial problem or lack of liquidity May make it impossible to pay insurance premiums. The policy review will let you know which policy you should keep and which issue to cancel. Also, what other options do we have? That will provide better benefits than canceling the policy Which the option to modify the policy There are a few things to consider:

Considerations for Policy Modification

1. Life insurance

We can manage life insurance policies through Cash Value. The cash value of the policy is the value that arises from the remaining money in the insurance premium. After deducting policy administration fees and various expenses in life insurance already. The insurance company will invest the rest of the money to get returns. That means in paying the insurance premiums. The money will be divided into 2 parts. Apart is the total cost of life insurance. And the other part will be an investment. If it is a traditional life insurance policy Life insurance companies will lead this money to invest. They usually invest in low-risk assets. But if it is unit-linked life insurance, the portion of the investment will be invested in the mutual fund selected by the insurance company. According to the acceptable risk level of the insured.

If it is traditional life insurance, we can choose to manage the policy in several ways. By looking at the table of insurance policy values ​​that we want to modify Which can be adjusted in 3 ways as follows:

• Policy expropriation Is to stop paying insurance premiums And requesting a refund of the total cash value in the policy. Which is set in the policy value table. The reason for the policy expropriation May be caused by the insured does not need or do not want protection from that life insurance policy. Which when expropriated will be considered closure of the policy the life insurance contract is terminated immediately. The thing to be aware of is that if you pay your insurance premium for a while. Resulting in little or no cash value when surrendered Will lose compared to the premium paid.
  
  
• Convert your policy to a successful amount of money is to stop paying insurance premiums Then ask to exercise the rights that make the policy still have life coverage until the end of the contract as before. But the value of life protection and the full contract that will be received may be reduced from the original. Depend on the completion value specified in the policy value table.
  
  
• Convert your policy to an extended value Is to stop paying insurance premiums then ask to exercise the right to keep the policy still having life coverage. But the life coverage period of the contract will change according to the policy value table.

If it is unit-linked life insurance, there will be separate expenses. And the investment portion is clear. The policy surrender value is equal to the purchase value of investment units or the value of our investment itself. For policy units, the link is not worth the money to complete. And the extended value of time. Causing us to manage the unit policy Link from cash value Which can withdraw money from the policy. If there is a need for money Which will have a withdrawal fee as stated in the policy. If there is a need to stop paying the premium but want to have further protection Eligible for Premium Holiday.

Which is to give the life insurance company the right to collect various expenses Under policy. Such as insurance fee Policy administration fee Policy maintenance fee by the redemption of investment units of mutual funds. Which is to send an order to sell investment units automatically Which the insured does not need to submit the order by themselves and considered as a condition of the insurance contract. In order to keep the policy in effect while the customer does not pay the premiums within the specified period.
However, if the remaining policy value is insufficient to pay the expenses Under policy Policy will be terminated.

2.Health insurance and critical illness insurance
 

Before considering the cancellation of health insurance and critical illness insurance You should verify your right of treatment first that What medical expenses are entitled to? How much is the coverage? And is it enough? Because if canceled already Became ill and became ill and without any health coverage left, it can lead to financial problems.

If you want to modify the coverage to suit your ability to pay the premium Don't forget that health insurance and critical illness insurance. There is only money, may not be able to buy. Must be in good health. If you want to cancel your existing health insurance or disease insurance in order to make a new version with more coverage or more modern. I Will not be able to cancel the old version and go buy the new one immediately. Because both health insurance and critical illness insurance have waiting periods ranging from 30 days to 180 days (depending on the disease).

Therefore, we should buy new insurance first. To ensure that they are fully protected and past the longest waiting period Before canceling the old one. Important if there is an underlying disease It is not recommended to cancel the old policy is strictly prohibited. Because if you want to make a new policy, you may not be able to purchase through or they may not be able to get coverage for diseases that were before the insurance.

In summary, the various insurance That is a good thing It will give us a risk management aid in the event of various unforeseen events. Which we should study the details of coverage and various options of the policy carefully. It will help us to have guidelines for managing the policy properly in case of emergency. Or when protection is no longer needed Allowing us to reduce the burden of paying premiums or using various benefits in the policy to increase efficiency.

Nipaphan Poonsathiensap CFP®, ACC

Independent Financial Planner Writer and speaker