- Life insurance is a very important purchase.
- Many people fall for myths that prevent them from getting covered.
- Contrary to popular belief, life insurance can be affordable, and you don't need perfect health to buy coverage.
Believing these misconceptions could lead to regrets.
Life insurance is one of the most important purchases a person can make. But unfortunately, some people are deterred from getting a policy they need because they fall for some common misconceptions. To avoid this, it's important to learn the realities surrounding these four big life insurance myths.
Myth No. 1: You don't need insurance if you don't have dependents
One of the biggest misunderstandings about life insurance is that it is only important to purchase coverage in circumstances where there are dependents relying on the potential policyholder's income.
Here's the reality: Many people do end up with someone who depends on them to provide income or services. This could be a spouse, children, or aging parents. And a person who waits until they have dependents could find themselves developing a pre-existing condition before they get coverage that ends up making it much more difficult to get an affordable policy.
This is why young people should buy insurance when they are still young and in great health even if no one "needs" them yet. By getting coverage in place early, they can protect their loved ones in the future.
And even those who never end up with others depending on them may still want to have a policy in place to ensure their funeral can be paid for without others having to cope with the financial burden of their final expenses.
Myth No. 2: Insurance is expensive
Another big misconception is that life insurance is expensive. In reality, it is typically very affordable to buy a term life insurance policy. This is especially true if it is purchased at a younger age, but even older people can still get covered for a reasonable sum -- especially after shopping around for coverage.
Further, while it may seem expensive to pay premiums, a policy can provide peace-of-mind and save surviving loved ones from financial disaster in the event of an untimely death, so it is usually well worth paying for.
Myth No. 3: Term policies are a waste of money
One big reason many people don't get covered is because they have the mistaken belief that term life policies are a waste of money. This misperception comes from the fact the policy will only pay out if the death occurs during the coverage term. It can feel like a waste to have paid premiums for 20 or 30 years, only for no death benefit to be paid in the end.
These premiums are not a waste, though. They protect against the risk of an untimely death that could devastate surviving loved ones financially. The best case scenario is that the coverage won't end up being needed -- just like the best case scenario for auto insurance is that no car accident ever occurs. But it's still important to have coverage in place in case something does go wrong.
Myth No. 4: You need perfect health to get covered
Finally, one last myth that prevents people from buying life insurance is the mistaken belief that only those in perfect health can get a policy. The reality is, just about everyone can find some kind of coverage even if it's just a guaranteed issue policy.
Rather than falling for these myths, shop around for life insurance and investigate all of the options available to make sure misconceptions don't stand in the way of important protections for loved ones.
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