Any kind of insurance can be confusing, but life insurance is one type that a lot of people have misconceptions about. To help clear up those misconceptions, listed below are five of the most common ones, accompanied with explanations about why they are incorrect.
The Life Insurance You Get Through Your Job Is Enough
It is nice if your job provides you with life insurance, but unless you are planning to work for that company until the day you die, literally, this life insurance will be insufficient. As soon as you stop working for that company, your coverage ends, making a personal policy a better option.
Employer-paid policies also typically only offer coverage that is either a modest flat amount or is equivalent to one year’s salary. This amount is usually not enough for the average person. You will want to make sure there is enough to cover medical and funeral bills and have enough leftover for your loved ones to pay off debts and cover basic financial needs.
Life Insurance Is Too Expensive
In a recent study, 80% of people surveyed overestimated the cost of a life insurance policy. The study found that millennials in particular overestimate the cost of insurance, in this case by 213%! They guessed that, for a 20-year, $250,000 term life insurance policy for a healthy thirty year-old, the annual cost would be $600. Older survey participants did not overestimate as much, but they still put the annual cost at $400 (on average), which is a 119% overestimation.
The actual cost? Approximately $160 annually. As you can see, it is much more affordable than almost everyone thinks.
Only The Breadwinner In The Family Needs Life Insurance
In families where only one spouse earns an income, some people think that the breadwinner is the only one who needs life insurance. But if something were to happen to the stay-at-home parent, the breadwinner of the family might need to hire someone to clean, cook, and take care of children, expenses that were not an issue before. Factoring in funeral costs, life insurance is a wise choice for all members of the family, no matter how much income they earn.
People In Poor Health Cannot Get Life Insurance
Contrary to popular belief, many life insurance companies will sell policies to people with a variety of medical problems. Some carriers even specialize in high-risk cases.
It is true that coverage can be more expensive than it would be for someone who was in better health, but many insurers are willing to work with you to accommodate your specific needs.
If You’re Single and Childless, You Don’t Need Life Insurance
If you’re single and childless, you might not think that you need life insurance since you have no one who is dependent on you. However, life insurance will help cover the costs of funeral arrangements, bills, and debts. These things can become a burden on family members, such as parents or siblings, if you don’t have the proper insurance.
Life insurance can be stressful, even frightening, to think about, but a policy is very important for yourself and your family. To learn more about life insurance, consult with Best Insurance Services, located in Moreno Valley, today.