With new commitments, having children, and buying their first home, young families often overlook purchasing the life insurance they need. However, if a family member dies unexpectedly, life insurance is there to ensure their family can maintain their standard of living, remain in the home, and keep their plans on track. The following are common misconceptions that prevent young people from buying the life insurance necessary to protect their loved ones in the event of a tragedy.
Myth #1: Only Primary Breadwinners of the Family Need Life Insurance
No matter the amount of the paycheck, your families relies on everyone doing their fair share to contribute. Even stay-at-home parents perform important duties, such as childcare, housekeeping, and household management, which can be difficult to replace for a surviving spouse.
Myth #2: If I Purchase a Term Life Insurance Policy and Discover That I Still Need Protection When the Term Ends, I Can Renew the Policy at Any Time
Term policies often offer the best coverage at a low cost, which is why they are popular amongst young families. Term insurance provides protection for a certain period and can be ideal for those with expenses that will go away over time, such as a mortgage or a child’s education. However, families later understand that their insurance needs continue. And since life insurance premiums increase with age, renewing your policy when the term ends can be quite costly.
Myth #3: I Only Need Term Life Insurance
As mentioned above, term life insurance offers protection for only a specific amount of time. Permanent life insurance policies provide a death benefit and other unique features, including lifelong protection and ability to accumulate cash values on a tax-deferred basis, in the same fashion as assets in retirement-savings plans.
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