Demystifying life insurance myths

When considering your life insurance needs, it’s important to know the difference between myth and reality so you can protect what you love about your life.

Myth: I am too young to need coverage.

If you’re a Millennial, you may feel that you don’t need life insurance because you are financially responsible only for yourself. However, not all debt disappears upon death. You should consider having enough life insurance to cover your student loans, credit card debt, or other loans you may have.   

Myth: Insurance isn’t affordable.

Not all life insurance options require expensive premiums. Purchasing life insurance through work can be an affordable way to obtain coverage because you can take advantage of group rates that are often less expensive than if you purchased insurance on your own.

Myth: My beneficiaries can use my life insurance benefit only to cover funeral expenses.

Beneficiaries of a life insurance policy may receive a lump sum payment, which they can use however they see fit—such as to satisfy outstanding debts or cover household expenses—to help protect their futures. Although beneficiaries may choose to use the life insurance benefit to help with funeral expenses, they are not obligated to do so.

Myth: Life insurance coverage does not need to be re-evaluated.

When you have life insurance, it’s in your best interest not to set it and forget it. Your coverage should be re-evaluated at different stages of your life because as your circumstances change, your financial obligations and the amount of coverage you need might change too.

Myth: My coverage at work will end if I leave my employer or retire.

If you elect insurance through your employer, it can be frustrating to think that you might lose your coverage after paying years of premiums if you decide to change jobs or retire. However, many life insurance policies available through your employer may allow you to apply to take your coverage with you if you were to terminate your employment.

There are many misconceptions about life insurance, so it is important to do your research, explore your options, and know the details of your policy, so you are prepared if something were to happen. Having a plan for life insurance can help you protect the life you love by securing it for the people most important to you.

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SLPC 26720 08/15 (exp. 08/17)

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