Life insurance is an important purchase for your clients of all ages who want their surviving family members to be provided for in the event of their death.
But it can be especially essential for clients in their 40s to make sure they are covered since many people in this demographic have lots of financial commitments and start to develop health conditions.
Here are three things your clients in their 40s need to know about getting covered.
- Coverage through work may not be enough
Many employers provide workplace benefits that include life insurance. Unfortunately, these policies may not provide all the protection people need. For example, the death benefit might not be large enough to replace all of the deceased person's income nor big enough to make sure surviving family members can meet their financial obligations.
Moreover, it is possible that a job loss could lead to a loss of coverage. If that is the case, it could be a disaster if their family is relying on their income.
Rather than depending solely on workplace life insurance, those who are in their 40s may want to look into buying a separate term life plan from an insurer that offers a death benefit large enough to take care of surviving dependents – and that will not be lost if a job change happens.
- It's probably not too late to get covered
Many people in or near their 40s assume it is too late to buy life insurance. But that is not the reality.
Many insurers will sell coverage to people who are well into their 40s and even into their 50s. And these are standard term life insurance policies – not guaranteed issue coverage, which is available to anyone regardless of health status but provides much more limited protection.
Even for those who have medical conditions, standard coverage can still be obtained in many cases. While premiums may be higher, people generally are not precluded from buying a life insurance policy unless they have a fairly serious health concern.
For those who cannot get standard coverage because of major health problems, guaranteed issue coverage should still be an option. And it can offer at least some money to help surviving family members pay for funeral costs and other expenses after a death.
- Term policies can be affordable for many
Finally, many people assume life insurance will no longer be affordable once they are in their 40s – but that is also not true.
Premiums on a standard term life policy could still be within many people's budgets.
Remember, though, that the longer a person waits, the higher premiums go and the more likely it is they will develop a condition that makes them uninsurable. To avoid this undesirable outcome, anyone in their 40s who does not already have life insurance coverage should consider buying a policy sooner rather than later.
This is an abridged version of an article by Christy Bieber in Nasdaq.com.