Misconceptions About the Cost of Life Insurance

It feels uncomfortable to face our own mortality and in our younger years, it often feels like an unnecessary discomfort. This means that we don’t talk about life insurance nearly enough. In truth, miseducation and faulty assumptions are behind the lack of coverage that affects nearly half of the adult population in America. Here are a few common myths that are keeping people from getting coverage and the truth behind them.

Myth: I’m Too Young for Life Insurance

How many young, healthy adults know how much it costs to bury someone? Unless you’ve recently suffered the loss of someone near and dear to you, you’re probably undershooting the estimate. The median costs for burial and funeral arrangements in 2021 were between $7,800 and $9,240. Unless you have more than $10K in savings, you may be leaving behind a hefty bill for your family to pay.

The life insurance coverage provided through an employer plan is often insufficient to cover everything. When considering how much life insurance you need to have, think about your debt, potential medical expenses, burial costs, and the loss of income caused by your passing. Plan carefully to ensure that you’re covering your expenses and appropriately providing your family.

Myth: I Can’t Afford Life Insurance

Even when adults do consider the financial aspect of their death, it’s a pretty common misconception that life insurance is unaffordable. Or, that it isn’t a priority for families struggling with layoffs, inflation, and rising debt. The truth is, according to LIMRA, that you’re probably overestimating the true cost by as much as three to six times. The average healthy 30-year old only pays about $160 per year for coverage.

Myth: It’s Too Hard to Buy Life Insurance

Insurance can be a little tricky to understand. But a good agent can help make the process a little less scary. The good news is that the COVID-19 pandemic and current technology are helping insurance companies simplify the underwriting process and provide more transparent information. In short, it’s getting a lot easier.

Here’s a quick overview of what to expect:

  1. Choose a Coverage Level
  2. Pick a Policy Type
  3. Shop for Insurance
  4. Fill Out an Application
  5. Complete a Telephone Interview
  6. See Your Doctor for a Medical Exam
  7. Allow the Insurer Time to Process and Approve Your Application

That’s it–buying life insurance isn’t too hard and your agent can help you understand that confusing stuff like policy types and coverage options.

The Bottom Line on Life Insurance

Life insurance is one of the best ways to protect your financial future. It can provide a little security so that you’re not saddling your family with piles of debt if you unexpectedly pass on. Everyone, regardless of age,  needs life insurance, however the amount of coverage that is appropriate does depend on individual circumstances. Call your agent today, life insurance is likely more expensive and easier to purchase than you might think.

The team at PHP Agency can help you choose the right amount of coverage and navigate the underwriting process. Contact us today to get started.