Life insurance is one of those subjects that most people avoid talking about because they don’t think it applies to them. In 2021, 52 percent of Americans own life insurance but that still leaves almost half of the population without life insurance for a variety of reasons, awareness on the subject being the main one.
Family is a given priority, and most people would do anything to secure their loved one’s future, but life insurance remains a big personal decision. If you have never done it before, now is the time to give it a serious thought but only after clearing the most common misbeliefs that are stopping you.
Myth #1: Life insurance is unaffordable
If you think life insurance is way too expensive and you will not be able to afford it, think again. A huge majority of people said cost was a major reason they did not get insured but the real truth is that people overestimate the cost of a life insurance policy, believing it is three up to five times its actual cost. The fact is that there is a choice of policy that will determine how much you will pay. Term life insurance is a practical and reasonable option that works for most people where the premium is more affordable than the premium for whole life insurance. Knowing your options and learning that your premium will vary based on factors such as your age, gender, term, and health status should help you open up more to the idea.
Myth #2: Life insurance provided through work is enough
Being covered through a group policy as part of the benefits package at work is good but not the most secure option for your future. Firstly, if you’re working for a company registered in Pennsylvania, your employer is only obligated to provide life insurance only after the probation period of 3 months. Typically, that is not a problem; but it can become a problem depending on the potential risks of your job. Secondly, the benefit you receive from work-provided policies is open-ended and may change based on your job situation or the employer’s plan. So being laid off or moving from full-time to part-time, or even cost-cutting policy enforcement might mean a sudden end to the coverage that you were relying on. The recent pandemic has thrown a huge number of individuals into a situation where they are unemployed and have no policy during this unprecedented time. Moreover, this type of insurance will not be tailored to your specific personal needs and might end at retirement which is when you might need it most.
Myth #3: Life insurance is not for young, healthy, and single people
Investing in a life insurance policy is a smart decision and doing it at an early age is even smarter. Policies prices are typically based on risk, and the mortality rate of young people is far lower than that of older people. This translates into locking in a great rate that will be offered to healthy young people who have the advantage of then buying more coverage in the future.
COVID-19 has only toppled our beliefs on how long we might live so it no longer makes sense to view young and healthy people as safe. In Pennsylvania alone, the last quarter of 2020 caused around 186 ‰ deaths. Also, the 2019 state mortality rate for individuals between 35 and 55 years old, was already around 7.5%. Now, since the pandemic, that number has been steadily climbing. On top of that, not having anyone dependent on your income still means you need coverage for your student loans, debts, or even your hospitalization and funeral expenses as you grow old. Retirement and a loss of income because of a host of other reasons can make life stressful without a life insurance policy.
Myth #4: Life insurance is only for the family breadwinner
In today’s day and age when most households depend on a combined income, losing one can have a drastic effect on the lives of the entire family. A good life insurance policy can provide the backing in such situations, but even if your spouse is a stay-at-home parent, you have all the reasons to invest in one. Not bringing in an income doesn’t mean your spouse is contributing any less in running the family. Services like childcare, meal preparation, transportation, housekeeping, bookkeeping, etc. will need to be covered in the absence of the one who passed away and can be costly. Such a situation would also demand that the breadwinner takes time off from work to cope with the loss. The indirect costs associated with hiring domestic help and other service providers can then be overcome with an insurance policy for the non-breadwinner.
Myth #5: Life insurance is time-consuming and complicated
Most people avoid life insurance because they believe it is hard to understand and that it requires a lot of time to choose the best coverage. That might have been the case in the past when lack of information made it sound complicated and the ton of paperwork involved was scary. But with today’s digital revolution it can be simple, quick, and straightforward. Online applications and calculators make the task less daunting and help people shopping for life insurance. The automated process of finding your best option, based on your background information, your family, your financial goals, and your budget, is far simpler now. The result will point you to the best, data-driven, available options. It might seem intimidating at first, if you are not sure how to start and who to approach for the best advice. Fortunately, the long-term benefits of getting a good custom-tailored policy will outweigh the initial discomfort.
All in all, deciding to get a life insurance policy is about the peace of mind you will enjoy knowing your loved ones are safe and looked after even in your absence. The initial conversations may not be easy, but we are all in a new world where COVID-19 has changed our thinking completely. Being prepared for the unexpected makes more sense now than ever and talking to us will help you consider the variables, lay out the options, and find the solution that best fits your needs. We provide the best-customized life insurance in Pennsylvania. Visit Gilmartin Insurance Agency in person at one of our locations (Scranton, Pittston, Lehighton) or reach out to us for a virtual consultation.