Life insurance is one of those things many of us don’t like to think about. Instead of looking into all the ways that life insurance could benefit us, we buy into the myths and misconceptions that tell us life insurance is too expensive, too complicated, or simply unnecessary.
The truth is, life insurance is none of those things — but it is really important. If you’ve been avoiding life insurance because of these myths, it’s time to learn the truth.
Top 5 Life Insurance Myths
Life insurance is expensive
Are you convinced you can’t afford life insurance? If you think life insurance costs are comparable to health or car insurance rates, you’re in for a pleasant surprise: If you’re a healthy non-smoker in your 30s, you could pay as little as $222 a year for $500,000 in coverage. That’s about $19 a month, or roughly the cost of a restaurant meal.
I can’t get life insurance because of a pre-existing condition
Many people pass on life insurance because they think that their pre-existing medical condition makes them too unhealthy to be accepted by insurers. The truth is that medical progress and the availability of preventative programs now allow many people with chronic conditions to live long and productive lives.
In step with that, life insurance companies will even offer preferred rates to people with health issues such as anxiety, asthma, depression, high cholesterol, hypertension, weight problems, sleep apnea and others.
I don’t need life insurance while young and single
Buying life insurance when you’re young and healthy can land you a better rate, but do you really need life insurance so soon? Even if you’re healthy, and childless, life insurance may still be a good idea. Accidents can happen any time; if they do, you’ll want to leave your family enough money to pay for a funeral and wrap up your affairs. If you have debt that’s cosigned by another person, such as student loans, life insurance is especially important.
Stay-at-home parents don’t need life insurance
There’s no question that life insurance is critical for your family’s breadwinner, especially if you have kids at home. However, even stay-at-home parents should be protected by a life insurance policy. The loss of a stay-at-home parent can be a huge hit to a family’s finances; not only must the surviving parent pay medical and funeral expenses, they also have to pay for childcare now that their spouse is gone. Life insurance covers these expenses so your family doesn’t suffer.
You need 10 times your income in life insurance coverage
10 times your yearly income is a commonly cited rule of thumb when it comes to buying life insurance. But rather than relying on simplistic guidelines, you can accurately estimate your life insurance needs by using a detailed online needs calculator to determine the amount you should get. It will take into account such things as lost income, debt obligations, the cost of college education, and funeral costs to determine how much money your family needs going forward.
While life insurance can seem like an unnecessary expense when you’re just trying to keep up with the monthly bills, buying life insurance is one of the best things you can do for your family’s financial security – just like you do when insuring your car, your home, and your health.
When you’re protected by life insurance, you can rest assured that your family will be cared for no matter what happens.
About the author, Nicole Rubin
I worked in the health insurance industry for years. Every day I fielded questions from people concerning their coverage and medical bills. I learned a lot about how the industry works, the limitations and challenges health insurance companies face, and the limitations and challenges faced by their customers.
Though a lot has changed since I worked in health insurance, I’m still very interested in the industry and the ongoing debate over how medical coverage should be handled in the U.S. I created Insureabilities to provide up-to-date information on the state of health insurance in the U.S.