7 Common Myths About Life Insurance, Debunked

You probably know that life insurance can provide a financial cushion for your loved ones, helping to cover medical bills, funeral costs, credit card debt and other bills if you pass away. But do you know life insurance myth from life insurance fact? Here are some common myths about life insurance, and the facts behind them.

Myth: 1
All life insurance is the same.
Fact: There are a lot of different options when it comes to life insurance. The two main categories are term life and whole life insurance. It’s important to know the differences between these products before you decide whether one or the other (or a combination of both) best suits your needs.
Myth: 2
Life insurance is expensive.
Fact: Life insurance can be affordable, depending on the type of life insurance and amount of coverage you choose. Generally, term life insurance offers more affordable protection initially, with premiums that increase as you age; whole life is usually more expensive initially, but offers coverage that can last your entire life and premiums that won’t increase simply because you grow older.
Myth: 3
Life insurance is hard to get.
Fact: Getting life insurance might be easier than you think, especially if you’re expecting to have to see a doctor to qualify. These days, many insurance products don’t require a medical exam; acceptance is based on health information. This process, known as simplified underwriting, can take a lot of the hassle out of applying for life insurance.

Myth: 4
Life insurance isn't important if you don't have dependents living with you.

Fact: Even without dependents, most of us leave at least some expenses behind: funeral costs, medical bills, mortgages or debt. Without a plan in place to pay for these expenses, they could take a big bite out of your estate. Life insurance can help pay for these and other expenses, protecting your financial legacy.

Myth: 5
You don't need life insurance if you're covered by your employer.

Fact: Employer-issued life insurance may or may not be enough to cover your individual situation, and it may not be in effect once you retire. If you think you’ll have more expenses than your employee coverage can pay for, or if you’re planning to retire, it may be a good time to consider supplemental life insurance.

Myth: 6
You don't need to revisit your life insurance policy after you purchase it.

Fact: Life is always changing – and with it, your financial needs. Whenever you have a major life event, such as marriage, divorce, a birth or death in the family, take a few moments to re-evaluate your life insurance coverage. An annual review is also a good idea, just to ensure that your coverage is still aligned with your needs.

Myth: 7
It doesn't matter who you buy life insurance from.

Fact: When you buy life insurance, the company you buy from can make all the difference. You want to choose a company that’s likely to be there when you need them, and financial strength is a key indicator of a company’s trustworthiness. That’s why life insurance ratings are important—they can help you find a company you can trust.