It is a common thing to find misunderstanding about life insurance. By believing these myths, we could find ourselves lacking the appropriate amount of coverage. In this case, we should make the proper insurance choices for our family. Here are some myths that we should debunk:
1) Life insurance isn’t needed for people who don’t work outside the home:
Just because we are safer by working at home, it doesn’t mean that we will be able to escape untimely death. Life insurance policy is useful, because it is able to replace any kind of financial implication due to the death of a family member. Even the death of a person who stays at home and doesn’t receive paycheck could be quite problematic. There’s no one who is caring for the children, cooking the food, doing the cleaning tasks and others. It means that we need to spend more money to buy food, for babysitting and others.
2) I’m still young, I don’t need it right now:
Some people are reluctant to purchase life insurance policy, because they don’t want to contemplate their mortality. Even if we are young, it doesn’t mean that we would live forever. In fact, it is a good idea to start having life insurance policy while we are younger and healthy. The average premium will be lower; because as we grow older, we represent more risks to the insurance company.
3) It’s too expensive:
Affordability is a factor why many people are reluctant to purchase life insurance policy. Although by buying life insurance we need to allocate some money for paying the premium, we actually provide financial security for our family. If we purchase the policy at a younger age, the average cost can be lower than $1 per day.
4) There are hidden exclusions, so beneficiaries may not receive the money:
In reality, life insurance can be the most straightforward coverage. As an example, the term life insurance policy provides coverage as long as we pay the premiums. If during the period that the insured person die, an agreed amount of money will be paid to the surviving family members.
5) I already have employee benefits, life insurance isn’t necessary:
There’s no guarantee that the employee benefit protection will extend after our retirement period. There’s a wide gap between the actual coverage provided by life insurance and employee benefits. By having proper life insurance policy, we will have the peace of mind. When a significant family member died, the financial compensation can be equal to up to 10 years of salary.
This will help the family to recover financially. They will be able help children pay the college or make sure that mortgage will still be paid. Chances are, there’s a big gap between standard employee benefits and normal life insurance plans. Plus, the coverage usually stops when we leave the job and there’s no guarantee that at the next employment, we will obtain similarly good benefits. This is something that we need to think about.