Clearing the air on life insurance myths, misconceptions, and misinformation spread by people with little to no knowledge about insurance. They can make it overwhelming to shop for the right coverage, especially if you don’t know the facts about life insurance.
Common Myths About Life Insurance Debunked
Below, we lay out the most common life insurance myths and facts to help you clear any doubts and gain the knowledge you need to choose the right life insurance coverage.
Life insurance is expensive
This is one of the most prevalent myths about life insurance. The fact is, life insurance premiums are quite affordable than you may think. Monthly term life insurance premiums range between $30-$60 depending on the policy you choose, your age, and multiple other factors.
I’m young, so I don’t need coverage
This is a common insurance myth among healthy and vibrant youths, and believing it may cost you a lot of money later in life.
The fact is, the best time to purchase life insurance coverage is when you are young. If you wait to shop for a policy in your 50s or 60s, your premiums may double or triple compared to the low rate you could have locked in your 20s or 30s when you were young and healthy.
You can’t get coverage with a pre-existing condition
It may be harder to qualify for regular life insurance with a pre-existing condition such as cancer, diabetes, obesity, heart disease, and HIV/AIDs, but it is not impossible. Though the coverage may come at a higher cost and with a smaller death benefit, it’s still better than nothing.
In fact, some insurance companies have policies tailored for people with such conditions. You can even skip a medical examination and get covered if you go for a guaranteed issue life insurance policy, or by seeking group life insurance through your employer.
Singles with no dependants need no coverage
This is a common insurance myth among bachelors who don’t plan to have a family. The fact is, life insurance is not only for breadwinners, but also for business owners, debt-ridden individuals, and philanthropists.
The death benefit can help cover any outstanding cosigned loans, buy out your share of a business you co-own with partners, or have your money go to the non-profit or a charity you support when you die.
Term insurance is the only life insurance coverage
Of course, term life insurance is the most common and recommended policy for most people as it helps cover the risk of untimely early death. The fact is that there are various term life and whole life insurance products to choose from, and you should consult with an independent insurance agent or expert to get the facts about insurance and choose the right policy.
Claim settlement is a hassle and the benefit may not payout
This is one of the insurance myths that hinder most people from seeking coverage as people fear the hassles and processes that may come with filing insurance claims.
As long as you provide the correct information and keep premiums paid on time, the policy remains in force, and the death benefit will payout if you die within the covered period. Filing a claim in the modern age is also hassle-free as insurers have their processes digitized.
Life Insurance Myths and Facts: Bottomline
Life insurance is a complex topic, and misleading insurance myths can make you reluctant to seek coverage. Plus, insurers offer multiple life insurance policies to meet the unique financial needs of families and individuals, and choosing the right policy can get a bit tricky.
Instead of believing the insurance myths you hear on the streets, it’s advisable to talk to an insurance expert. An independent insurance agent can help you get the facts about life insurance and lock in a lower rate.