Life Insurance Blog

There are several myths about life insurance that can end up costing people money if they are not corrected. These myths can also be harmful to the family of the uninsured as well as to other loved ones, by putting them into a financial hole that will only serve to compound their grief and sorrow. To avoid this, it is best for individuals to know the truth about life insurance and to act accordingly to provide for those who are closest to them.

• Single people do not need it. Single people often feel that they do not need life insurance because they either have no dependants or because they feel vibrant and healthy. They tend to fall into the trap of believing that life insurance is only for those people who have children or spouses, who have come to depend on them for their income and financial contributions. The truth is, however, that life insurance policies for single individuals are essential because nearly everyone has some sort of financial obligations which will fall into arrears upon that individual’s passing.
• Young people do not need it. A young person’s attitude about life insurance can be similar to a single person’s, namely, that they do not need it because they are either in the prime of their lives or they believe that no one will benefit from their life insurance policy were they to take one out. While the former may be true, the latter most of the time is not. Young people do, however, have an even greater incentive to purchase life insurance as soon as possible, and it concerns their ability to save money. Life insurance policies for younger individuals are cheaper than the premiums assigned to middle age or older policy holders. This is because those of advanced age are more at risk of life-threatening disease or injury. Such increased risk means that they are less likely to outlive their life insurance policy than someone with the same policy at a much younger age. Their higher levels of risk in turn impact the risk taken on by the life insurance provider. The primary means of offsetting this risk is to raise the cost of life insurance premiums. If these people had taken out their life insurance at an earlier age, they would have paid less overall for the same coverage and been better off financially.
• People without children do not need it. Dependants are too often defined as under-age children who are still in the care of their parents. While this may be the legal way to define the term, the truth is that there are more people dependent upon a working adult than just their children. Even those couples without children have people who depend on them for their financial contribution. In the event of one or their deaths, the two people in a live-in partnership or a childless marriage have each other to think of, just as much as if they had had children. Without a life insurance policy in place, the surviving spouse or partner will be at a loss to provide for themselves and the expenses that they shared with their loved one. For this reason, a life insurance policy is a great way to help provide for loved ones even in the absence of legal dependants.