Life Insurance
Prioritize your loved ones’ financial stability

Finding the right life insurance policy for you and your family is an essential part of a good financial plan. It ensures loved ones facing life without you can focus on what’s really important—each other. It is crucial to evaluate various life insurance options, whether through employer-offered worksite solutions or exploring independent avenues to ensure that you choose what works best for you and your loved ones.

Potential misconceptions may be a barrier to understanding the product or coverage, which can prevent consumers from purchasing life insurance or obtaining higher coverage.

Here are some common myths that prevent people from purchasing life insurance:

Myth 1: “Life insurance is too expensive.”

In a recent study by LIMRA, three-quarters (72%) of Americans overestimate the true cost of a basic term life insurance policy (LIMRA - U.S. Life Insurance Need Gap Grows in 2024). This opportunity to enhance financial literacy surrounding affordability highlights the need for accurate information and education regarding the true cost of life insurance among the general population.

When LIMRA and Life Happens asked those surveyed why they don’t own life insurance, 52% stated that it was too expensive, 78% overestimated the true cost of a basic term life policy and 54% based their cost estimate on “gut instinct” or a “wild guess” (LIMRA/Life Happens - 2024 Insurance Barometer Study).

Myth 2: “Life insurance can only be used to cover funeral expenses.”

While it is a common myth that life insurance can only be used to cover funeral expenses, this belief couldn't be further from the truth. In fact, life insurance can be used for a variety of crucial expenses. Some of which include, end-of-life celebration costs, mortgage payments, education costs and daily living expenses.

It's important to note that the specific benefits and features of a life insurance policy may vary depending on the type of policy you have. Term life insurance, for example, provides coverage for a specified period of time, while permanent life insurance policies, like whole life or universal life insurance, offer coverage for your entire life and can accumulate cash value.

This aspect of life insurance highlights its value in offering security and stability for those you care about most, allowing freedom for use funds to best meet the needs of your beneficiaries.

Myth 3: “My current savings or investments is enough.”

While it may seem like your current savings or investments are sufficient, it's important to consult with a financial professional to evaluate your specific circumstances.

Recognizing the potential of life insurance offers the opportunity to bolster your financial well-being and create a solid foundation for future growth and stability. It can enhance your ability to navigate unexpected circumstances and provides a sense of empowerment in taking proactive steps towards financial literacy.

Myth 4: “I can wait until to buy life insurance until I'm older.”

A different 2022 LIMRA study showed, 40% of people who have life insurance policies admit that they wish they had bought it when they were younger (LIMRA – Top Misconceptions About Life Insurance).

Securing a life insurance policy when you are younger may be an advantage because it allows you to take advantage of lower premiums. Rates may increase with age which means locking in a policy earlier in life can provide significant cost savings over the duration of the policy.

This doesn’t mean you should forego securing a policy if you are later in life. Take the opportunity to understand your options to set your family up for success.

Each of these issues underscores the lack of – and need for – education surrounding life insurance. We’re here to help! If you want to learn more about life insurance for you or your employees, and need help understanding what it covers, contact a Combined Agent today!

This blog post is intended for educative and entertainment purposes only. It should not be construed as solicitation, financial, legal, or medical advice. Policy exclusions and limitations apply. See policy for complete details for policy features, benefits, options, rates, definitions, and limitations and exclusions. Policies are underwritten by Combined Insurance Company of America (Chicago, IL) in all states except New York. In New York, policies are underwritten by Combined Life Insurance Company of New York (Latham, NY). Combined Insurance of America is not licensed and does not solicit business in New York.