3 misconceptions about life insurance

| 02 Mar 2023

Many people think life insurance is expensive, unnecessary for childless people, and not available to those with health conditions. Here are three myths you can debunk with your clients.

Life insurance is prohibitively expensive

Many people assume that life insurance won't fit into their budgets. But actually, if your clients stick to a term life insurance policy, they may find that premium costs don't break the bank at all. 

A healthy 35-year-old male can expect to pay about $30.44 per month for a 20-year, $500,000 term life insurance policy as of February 2023, while a 35-year-old female with the same term length and policy amount can expect to pay $25.66 per month, according to Policygenius. In many cases, that's less than the cost of buying coffee every day.

One thing your clients should know is that if they opt for a whole life insurance policy, costs for that might be prohibitively expensive. That's because whole life insurance covers them on a permanent basis, whereas term life insurance runs out on them after a period of time. Whole life insurance also accumulates a cash value they can borrow against or even cash out, whereas term life insurance doesn't. 

But for most people, the length of coverage offered by life insurance is more than enough. And while it's true that your clients’ beneficiaries won't get paid if they make it to the end of their term life coverage without having passed away, well, they'll have gotten to live. So there's that.


Your clients can't get insurance if they have pre-existing health issues

Having certain pre-existing health conditions, like diabetes or heart problems, could make it harder to get life insurance. So could certain lifestyle choices, like being a smoker. But that doesn't mean the option is off the table.

Your clients might need to pay more money for coverage, since life insurance companies might consider them a higher risk. Or, they might need to opt for a no-exam life insurance policy, which can also be more expensive and offer more limited coverage. As such, life insurance isn’t completely off the table for them.


Your clients don't need life insurance if they don't have kids

Many of your clients put life insurance in place specifically to protect their children. But it could still pay to get a policy even if they don't have kids. 

Maybe they have a sibling they support financially. If they were to pass away, that sibling might struggle, so it's easy to make the case for a policy.

And if they are married and have joint expenses with their spouse, getting life insurance could help the latter better manage the bills upon your clients’ passing – even if the spouse has a job.


There's a lot of incorrect information about life insurance out there. It pays to educate your clients on the ins and outs of life insurance so that they are in a better place to make the right decision for their loved ones.

This is an abridged version of an article by Maurie Backman which appeared on The Motley Fool.