Home Life insurance Life insurance basics How to read your life insurance policy How to read your life insurance policy Life insurance policies are full of legal — and confusing — language. Read our full guide so you know what it all means. Written by Shivani Gite Shivani Gite Shivani Gite is a personal finance and insurance writer with a degree in journalism and mass communication. She is passionate about making insurance topics easy to understand for people and helping them make better financial decisions. | Reviewed by Nupur Gambhir Nupur Gambhir Nupur Gambhir is an insurance expert and managing editor of Insure.com. She specializes in life and health insurance content, and has experience as a marketing consultant. | Updated on: March 12, 2025 Why you can trust Insure.com Quality Verified At Insure.com, we are committed to providing the timely, accurate and expert information consumers need to make smart insurance decisions. All our content is written and reviewed by industry professionals and insurance experts. Our team carefully vets our rate data to ensure we only provide reliable and up-to-date insurance pricing. We follow the highest editorial standards. Our content is based solely on objective research and data gathering. We maintain strict editorial independence to ensure unbiased coverage of the insurance industry. A life insurance policy is more than just a contract—it’s a financial safety net for your loved ones. With so many policy options, riders, and decisions to make, it can feel overwhelming to figure out what’s best for you. No matter what type of life insurance you choose, taking the time to read your policy carefully is essential. But, you’re not on your own — this guide will help you understand the ins and outs of reading your life insurance policy. Life insurance declaration page The first few pages of a life insurance policy include a high-level summary of your coverage. In most cases, the first page states the name of the insurance company, the type of plan you are purchasing, the name of the insured, the policy owner and the “free-look” period terms. Life insurance policies have a trial period, often referred to as the free-look period, which gives the policyholder a certain number of days – generally 10 to 30 days – to cancel the policy without penalty and get their first payment back. After the cover page is the schedule of benefits, also called the declarations page. The following details are usually included: Personal information: Review your date of birth, name, and any other information for errors. Benefit amount: The amount to be paid upon your death. Policy type: Specifies if you have a term or permanent policy. Premium amount: How much you have to pay monthly or annually for coverage. Policy issue date: The date that you were delivered a policy. Policy number: The unique number assigned to your policy. Your beneficiaries will need this number to file a life insurance claim. Risk class: This is the life insurance classification you have been assigned, which determines how much you pay. For example, Preferred versus Standard, or smoker versus non-smoker. Riders: This is supplemental coverage added to your life insurance policy. The people impacted by the life insurance policy are also listed on the declarations page. Life insurance policies have a policy owner, the insured and the beneficiaries. It’s important to note the people listed on the declarations page. The policy owner: This is the person who set up the policy and is paying the premium. The policy owner is the only one who has access to policy information and can change the beneficiaries listed on the policy. The insured: While this person is usually the same as the policy owner, they don’t have to be. When the insured dies, the life insurance company pays out the death benefit. The beneficiaries: The people who receive the death benefit when the insured dies. Beneficiaries are changeable and should be reviewed with every major life event. For example, if the insured gets a divorce and later remarries, they will want to update their beneficiary designation to list their new spouse. Life insurance policy terms and definitions Life insurance policies are written in legal language that can be confusing, but the policy terms and definitions sections explain what they all mean. Here’s what you can expect to find: Death benefit: The death benefit is the amount of money your beneficiaries receive. This section spells out the details of the death benefit and how your beneficiary will make a claim after your death. Contestability period: The contestability period is a set amount of time, typically two years from the policy issue date, when the insurer may contest and deny claims. Graded-death benefit: If you have a specific type of whole life insurance policy that pays out a limited death benefit in the first few years of the policy, this will be included. Exclusions: There are factors that can invalidate or limit a death benefit. Most policies won’t pay a death benefit if the insured dies by suicide within the contestability period. Any intentional misrepresentation of information you provide could result in the policy being voided or could even be considered insurance fraud. Premiums: This section details premiums, grace periods and reinstatement. Policies stay in force as long as you pay the premiums. Most policies have a grace period of 31 days, but it can vary. The policy will lapse if payment isn’t received by the end of the grace period. However, reinstatement allows you to restore a lapsed policy. Illustrations: Permanent life insurance policies have pages called illustrations that show how the policy will perform at certain interest rates. The illustrations will show how much you spend on policy premiums and how much you’ll earn in cash value. Riders: A rider is a supplemental coverage you can add to your policy. Accelerated benefits: Accelerated benefits is a clause or rider allowing the insured to receive a portion of benefits before they die if they have a terminal or long-term illness. Policy loans: Whole or universal life insurance policies allow the policyholder to take out a loan against the policy. As the cash value in a policy builds, you can borrow against the accumulated funds. Common mistakes to avoid when reviewing your life insurance policy Reading through a life insurance policy isn’t anyone’s favorite evening read, but skipping over key details can lead to big problems down the road. Here are some common mistakes people make—and how to avoid them: Not fully understanding the terms: Life insurance policies are full of industry jargon that can be confusing. Take the time to understand what terms like “cash value” and “riders” actually mean so you’re not caught off guard later. Ignoring exclusions: Every policy has exclusions—specific situations where coverage won’t apply. If you don’t know what they are, your family could be left without a payout when they need it most. Forgetting to update beneficiaries: Life changes fast—marriages, divorces, new children—yet many people forget to update their beneficiaries. Keeping this information current ensures your money goes to the right people. Not having enough coverage: It’s easy to underestimate how much life insurance you actually need. Make sure your policy is enough to cover your family’s financial future, including mortgage payments, debts, and everyday living costs. Leaving out important details: If you weren’t totally honest when filling out your application—whether about your health, hobbies, or lifestyle—your policy could be voided when it’s needed most. Always be upfront to avoid surprises later. By avoiding these mistakes, you can make sure your life insurance policy does what it’s meant to—protect your loved ones when they need it most. QuickTake What is cash value life insurance and how does it work? How to buy life insurance Comprehensive guide to life insurance: What it is and how it works How to find a lost life insurance policy How to get life insurance if you're uninsurable Who's who on a life insurance policy The life insurance contestability period: What you need to know What happens to the cash value of my whole life insurance policy when I die? Is accidental death and dismemberment insurance right for you? How to make sure you have enough life insurance Life insurance riders: What they are and how they work Guide to life insurance for transgender applicants Understanding your life insurance policy options What is a life insurance beneficiary? 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How to convert a term life policy to permanent life insurance Life insurance tax surprise: The unholy trinity How life insurance rates are determined How to do a needs analysis before you buy life insurance Sports that could knock you out of contention for life insurance Variable life and variable annuity sub-accounts: The more the merrier? See more > Life insurance policy exclusions While life insurance policies provide financial protection for your loved ones after you die, there are some exclusions that may apply where the insurer will not pay out to your beneficiaries. Here are the common life insurance policy exclusions: Suicide: Most life insurance policies exclude death by suicide or self-inflicted injuries, as well as deaths resulting from alcohol or drug abuse. Fraud: If your insurer finds that you lied about smoking, but then died from a smoking-related illness, the company can refuse to pay out the death benefit. Illegal criminal activities: Most insurers will not pay out if you die while doing something illegal. For instance, if you die while robbing a bank or trying to steal a car, your family will not receive any money from the insurance company. Hazardous activities: Life insurance policies exclude deaths caused by risky activities such as bungee jumping or skydiving. Your policy will specifically exclude any risky activities you participate in. War-time peril: If you travel to war-torn areas, your life insurance policy may not pay out a death benefit. However, there are exceptions if you are a soldier or traveling for work. Reviewing your policy and fully understanding what is in it ensures that you can make the most of your coverage and there are no hiccups along the way. Additionally, you should periodically update your life insurance policy with every major life event as your needs might change. × Get Free Life Insurance Quotes Today! Zip Code Please enter valid zip Age Age 16 – 20 21 – 24 25 – 34 35 – 44 45 – 54 55 – 64 65+ Coverage Amount Coverage Amount $50,000 – $100,000 $100,000 – $200,000 $200,000 – $300,000 $400,000 – $500,000 $500,000 – $1,000,000 $1,000,000 – $2,000,000 $2,000,000 – $5,000,000 $5,000,000+ Coverage Type Coverage Type Whole Life Term Life Final Expense Not Sure Gender Gender Male Female Non-Binary Tobacco Use Yes No Compare Quotes Shivani GiteContributing Writer | . .Shivani Gite is a personal finance and insurance writer with a degree in journalism and mass communication. She is passionate about making insurance topics easy to understand for people and helping them make better financial decisions. Related Articles What is term life insurance and how does it work? By Desiree Ghazi What is final expense insurance and how does it work? 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