Debunking Myths about Life Insurance

Life insurance can be a complicated subject. However, all the “experts” you hear from may not be correct on what they tell you. There are some common myths about this area of finance that you should be aware of.

You Don’t Need Life Insurance if You Invest

Some experts will tell you that there’s no need for life insurance if you have invested in real estate or other solid investments. However, your family may benefit from a life insurance’s policy to pay the taxes on your other investments or to allow them to continue to grow.

You Cannot Use Your Life Insurance Policy

Many people view insurance of their life similar to a will. It can only be used once you die. However, most policies have clauses which allow you to withdraw from your policy or cash it in while you’re still alive. You can ask about this option before you select a policy.

A Health Examination Doesn’t Mean Anything

When you have a physical examination as part of your approval process, it tells the insurer what policy you can get. They review the information to make sure you didn’t lie on the application and to ensure that the rates reflect the amount of risk involved.

Life Insurance Premiums are Difficult to Understand

While each insurer may use their own algorithm to determine rates for policyholders, they aren’t that complicated. Rates usually go up with age, which is why it’s better to get a insurance policy when you’re younger. Also, health status and any medical conditions can impact rates.

You Don’t Need Life Insurance Now

If you’re young and in good health, you may not feel the need for a policy. However, you never know when something can happen, so it’s best to be prepared. The only time when it might not be important to have a policy is if you have no dependents or even any property. Otherwise, you should protect your family and assets with a life insurance’s policy at any age.

You Can’t Get Life Insurance with Pre-existing Conditions

Even though your rates may be higher if you have certain health conditions, you can still qualify for a life insurance policy. Some insurers even specialize in those with medical conditions. You just have to search for an insurer that will cover someone with your health status.

You Should Get Life Insurance When You’re Young

Many experts will tell you that you should get life insurance of their life while you’re young. If you’ve waited until later in life, don’t despair. You can still get an affordable policy to see you through the rest of your life. Many people wait until later in life – some are even in their 70’s before they decide to invest.

You Don’t Need a Second Policy If You Have Insurance through an Employer

Many employers offer a life insurance’s policy for their employees. However, it’s usually only a small amount, such as one or two years of salary. If you have a family, especially with young children, you will need more coverage than that. It’s important to purchase another policy that will cover expenses for the long-term.

Your Occupation Doesn’t Impact Life Insurance Rates

If your occupation is deemed to be high-risk to your life or health, your insurance’s premiums could be higher. Insurance companies must determine how much of a risk you are to them to set your rates. Be aware of this factor when comparing life insurance quotes.

You should consider life insurance if you don’t already have a policy in place. If you do, you should evaluate if it’s enough or if you can get a better deal.