Last updated: November 25th, 2022
Reviewed by
Rebecca Thrift
Licensed Insurance Agent
In some cases, buying an additional life insurance policy may be the best solution, but there are other ways to alter or expand your coverage for you to consider.
Table of Contents
You can own more than one life insurance policy. In some cases, an insurance company may decline to issue an additional policy to someone who is already insured with them. If this happens, nothing prevents you from applying for a policy from a different insurer.
No law or rule limits how many life insurance policies you can have. However, companies may impose limits on the amount of life insurance they will provide for one person.
Each time you apply for life insurance, the insurance company’s underwriting department reviews the application and decides whether to approve it. In many cases, life insurers will cap the total amount of insurance you can purchase up to a multiplier of your salary. For instance, you may be able to purchase up to 20 or 30 times the amount you earn each year.
The reason for the salary cap relates to the purpose of life insurance. Although some people purchase policies as a way to generate wealth, life insurance is meant to replace your income and provide for your loved ones.
In some cases, purchasing multiple life insurance policies is the right choice for people who need to increase their coverage. Some potential benefits of having multiple policies include:
When evaluating your life insurance, you should be aware that owning more than one policy does have some downsides. Potential drawbacks include:
People may choose to have multiple life insurance policies for many reasons. Some common scenarios where you may benefit from having more than one life insurance policy include:
In some cases, you may be able to modify your current life insurance without having to purchase a new policy. Some alternatives include:
Buying more than one life insurance policy is often possible. It may be the best option if you need to increase your coverage, wish to begin using insurance as an investment, or want to protect your business as well as your family. Before buying an additional policy, review the terms of your current policy for riders or clauses that will allow you to alter it.
Brian is the founder and CEO of Insurist and carries Life, Health, and Property & Casualty licenses in all 50 U.S. states. Since 2013, Brian has been a member of Million Dollar Round Table, a designation for the top 1% of financial advisors worldwide. Brian has been featured in Yahoo! Finance, Money.com, Entrepreneur.com, Life Happens, Forbes, MSN, and Good Financial Cents. Brian’s goal is to show customers the best products, the quickest answers to their questions, and provide expert advice.
I've worked for Safeco and Liberty Mutual as a sales agent and claims adjuster for the last five years. My claims experience is primarily auto insurance, but I am licensed to sell auto and property insurance (homeowners, condo, renters, long-term renter, etc) currently.
