Erroneous Life Insurance Beliefs
Obtaining life insurance is a serious decision primarily because you are doing so not to protect yourself but rather to protect your family or loved ones after you die.
Getting life insurance coverage can be very confusing because you are financially protecting other people. How much is necessary? When do I need it? These are common questions that have varying answers depending on you and your family’s current and future situation and needs.
The article, “Five Life Insurance Myths” available on spectruminsurancegroup.com, provides answers to these common erroneous beliefs.
“People who choose life insurance policies based on myths about insurance could end up making a costly decision. It is important to understand which kind of life insurance is right for you or whether you need insurance at all.”
The legal language and terms used in life insurance policies can intimidate a novice borrower. These five myths also often confuse someone who is thinking about getting life insurance. Knowledge of these myths will provide you confidence to get appropriate coverage when you really need it.
The first myth is everyone should have life insurance coverage. “Life insurance protects dependents and guarantees a steady source of income after their breadwinner's death. Single people without dependents or childless couples who earn enough to lead a good life need not consider buying insurance.”
Another myth is that if you do not work, you do not need insurance. Even though a jobless parent with no income would think that there is no reason to replace income that does not exist, childcare could cost $10,000 to $30,000 annually. You could estimate your expected child care costs and claim that as salary on your life insurance application.
The worst myth of them all is that you think there is no need for insurance because you probably won’t need it. “Why skip life insurance to save money? The reason why life insurance is cheaper for younger people to buy is because chances of death are low for youths. But life is unsure and the time of our death is not predetermined therefore do buy life insurance to provide for your family incase the worst does happen.”
The right insurance policy may prove to save your family financially in case of a disaster. Although cliché, it is better to be safe than sorry.
Myth: if it is more expensive, it must be worth it. Term insurance is cheaper than universal or whole insurance and is a better choice for most of us since term life insurance is “pure” insurance with no extra investment pressures and fees and guarantees you coverage until the premium is paid in full.
“There are various types of Permanent insurance such as whole life, universal and variable, and more but is seven to eight times more expensive than term. A permanent insurance policy combines life insurance with an investment that builds up cash value which you can exploit by borrowing or surrendering (cashing in) the policy.”
The last, inexcusable myth is that life insurance is too much of a hassle to obtain.
Most reputable companies provide online access to download quotes and application forms over the Internet. You can easily shop for the best possible rates and gain additional knowledge about various terms and stipulations and then contact an agent to begin the actual qualification process. Or you can bypass ever talking to an agent and complete the whole process online; although some personal contact is advised just to make sure that you fully understand the coverage you will receive.