According to LIMRA, approximately 30% of households don’t have any life insurance and to a large extent, that shortcoming is all about incorrect information about the cost of a policy.
Marvin Feldman, President and CEO of the LIFE Foundation, is the head of a nonprofit organization that educates consumers about financial planning and insurance.
The LIFE Foundation collaborated with LIMRA on the 2013 Insurance Barometer Study, which found that the average consumer thinks life insurance is three times more expensive than it actually is. “[Consumers are] not researching it to determine what the cost is,” Feldman said.
Many are basing their decision to purchase on dated life insurance assumptions. Some, as they age, feel it is a waste of money, thinking they have enough assets and they are healthy. Inevitably, true stories bubble to the surface and there are many of them to share.
One man who was planning on buying life insurance got too busy with family and business and then was diagnosed with terminal cancer. With no life insurance before, now the options were bleak. Or the young pilot who was flying a private plane and felt that his own youth would carry him until a later time. He was killed in an accident with no life insurance. Or the older gentleman who bought an accident policy out of haste, not realizing that benefits would cover only his death by accident and not a stroke, which he died from.
Talk to an insurance specialist for the best available rates and make sure you understand the coverage of the policy. Understand how life insurance works in an emergency or building a strong savings plan. Do not base just your decision on cost but what is best for your situation. Life insurance can be complicated when buying the best policy but devastating without it.