Living Life as an Expat Calls for a Life Insurance Review

Living Life as an Expat Calls for a Life Insurance Review

A row of four suitcases of different sizes, arranged from biggest to smallest, left to right. Resting on the biggest suitcase is a wide-brimmed hat. Resting on top of the smallest suitcase is a stuffed bear. The image accompanies an article about how moving overseas permanently impacts a U.S. life insurance policy.

Living Life as an Expat Calls for a Life Insurance Review

Living like a nomad has its charms. The Internet makes it easy to work from anywhere, and online schooling has become a popular option for many families. But before you buy your plane tickets and pack your bags, make sure you take a look at your life insurance policy.

Remember, any life change—bringing home a baby or getting a divorce–necessitates you revisit your life insurance policy to make sure your death benefit will go to the people you want it to.

Life insurance isn’t travel insurance. Travel insurance covers unforeseen events like lost luggage. Life insurance covers your loved ones in the unforeseen event of your death. Travel insurance won’t pay the bills to keep a roof over your loved ones’ heads. Life insurance will.

Moving Overseas with a Current Life Insurance Policy

If you already have a U.S. life insurance policy, verify what is and isn’t covered. Most life insurance policies have no international travel exclusions. But some may—especially if you’re moving to a high-risk area. If your current policy doesn’t provide adequate coverage for a move overseas, buy another one.

Some life insurance companies view living abroad as too big of a risk to cover. Along with age and health, where you live is a key factor in determining your premium. If you end up living in a low-risk area, your chances of enjoying full coverage at a reasonable rate are pretty good. But if you plan to live in a high-risk area like say, the Middle East, you may have to pay higher premiums or forgo life insurance altogether.

Your occupation matters, too. If you are in the military or the work you plan to do overseas as a civilian is dangerous, a life insurance company may think twice before granting you a policy. But another may. It pays to shop around.

No Life Insurance? Buy Before You Say Goodbye

If you don’t currently have life insurance and are considering a move overseas, make sure you buy it before you move. Buying it once you’ve moved abroad will necessitate a trip back to the U.S. to apply for the policy, take a medical exam and sign the paperwork.

And if the insurance company asks about your future travel plans as they review your application, (and they will), be upfront about it. Not disclosing your plans can make a later claim null and void.

The Money Factor

Living abroad is expensive. A costly life insurance premium on top of other financial obligations such as a mortgage or alimony payments can make a policy seem out of reach.

Factor in the costs of repatriation should you die while overseas. Your loved ones’ inheritance taxes may come into play as well.

Consider which type of life insurance serves you best. You may decide the nomadic life isn’t for you. A term life policy that covers you for a set amount of time may be more affordable than an expensive whole life policy that locks you in for life.

If moving overseas permanently is calling to you, make a call to a life insurance agent before you go. Your family will thank you for it as well as for the memories you make together.

Nicholas Trawinski

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