"What do you do with a life insurance policy that's been sitting in a drawer since the early 1990s?"
That question came up during a recent meeting.
Like many families, this client had held onto two variable life insurance policies for decades. When the policies were first purchased, they served an important purpose. The children were young, the family was still building wealth, and the life insurance helped provide financial protection during those early years.
But life had changed.
The children were grown.
The family's financial picture looked very different.
And the policies were no longer serving the same purpose they once had.
Rather than asking, "Should we keep these policies?", we started with a different question:
"What job are these policies still doing today?"
As we reviewed the details together, we found that the policies:
The conversation quickly shifted from preserving an old policy to making sure their assets aligned with where they are today—not where they were thirty years ago.
One option we discussed was a 1035 exchange, which can allow certain life insurance policies to be exchanged for another qualifying insurance or annuity contract without triggering immediate income taxes, provided IRS requirements are met.
The goal wasn't simply to replace one product with another.
It was to determine whether a different structure could better support their long-term objectives by reducing ongoing costs while allowing the assets to continue working toward their financial goals.
As we continued the conversation, another important topic emerged:
The beneficiary designations.
Many people update their investments over time but forget to review who ultimately receives those assets.
Together, we discussed whether the existing beneficiary structure still reflected the family's wishes and how those decisions fit into their broader estate plan.
Because beneficiary choices can carry important legal and tax implications, we also emphasized coordinating any changes with their estate planning attorney before moving forward.
That part of the conversation brought noticeable peace of mind. It wasn't just about updating an insurance policy—it was about making sure the family's legacy plan still reflected their current goals.
Life insurance is designed to solve a problem.
But the problem you're solving at age 35 may not be the same one you're solving at age 65.
That's why reviewing older policies is just as important as reviewing your investment portfolio.
Sometimes the right decision is to keep the policy.
Sometimes it's to adjust it.
And sometimes it's to explore whether another strategy better fits your current stage of life.
The key isn't making assumptions—it's asking the right questions.
If it's been years since you've reviewed your life insurance, it may be worth asking:
Is this policy still doing the job I originally hired it to do?