The mere mention of life insurance can be daunting for many. More so when it comes to choosing one that fits your needs. Myths and misconceptions often cloud our judgement. To gain a better understanding of life insurance, it’s time we debunk those common myths.
MTYH 1: “I can’t afford life insurance.”
Many overestimate the cost of insurance. It’s especially common among Asian Americans says insurance professional and Filipino American Jordan Mangaliman. In a 2023 Insurance Barometer Study, 37% of Asian Americans cite perceived expense as the top reason for not owning life insurance, while 26% cited other financial priorities.
The truth is, there’s plenty of flexibility when paying insurance premium. One can opt for payment terms that matches one’s financial capacity. Also, the younger you are, the lower your premium rate. Then you can gradually increase your coverage as your income increases and your responsibility grows.
For sound advice, call Mercardo Global Insurance Brokers. We can help you explore different insurance options to find an affordable coverage with the benefits you need most.
MTYH 2: “My job provides enough life insurance.”
Compared to other race and ethnicities, 29% of Asian Americans were most likely to rely solely on their employment insurance for protection. While it may suffice for someone who’s young healthy and free of any responsibilities, employment insurance often takes a hit when your company goes through financial crisis. Sometimes reducing its benefits or worse, cancelling it completely as the organization tries to manage its finances. reduce the benefits. With life insurance that’s tied to your job, you also risk losing it once you resign or retire. Also, most employment insurance covers only death benefits.
What you need is a supplemental insurance policy that provides more than just final expenses. Make sure you take a policy that covers your future needs: your children’s education, housing, medical emergencies, retirement.
MYTH 3: “I can’t personally benefit from life insurance.”
While the primary purpose of life insurance is to provide financial protection for your loved ones upon your death, it can also provide living benefits. For instance, if you opt for permanent life insurance, it lets you build cash values that you can access to fund emergencies, pay college, buy a house, or supplement your retirement.
MYTH 4: “My savings is my life insurance.”
Your savings alone is not enough to cover all your future needs and your family’s. Imagine if your loved ones will use your savings to cover your final expenses. What’s left of it won’t be enough for paying the mortgage, paying debt or your children’s college education.
As Jordan puts it, by paying a premium for insurance, the insurance company will pay a benefit once an unexpected qualifying event occurs. So you don’t have to use your hard-earned savings.
MYTH 5: “I’m young, single, and healthy. Life insurance isn’t for me. “
The best time to buy life insurance is when you’re young and healthy. That’s because life insurance premiums are calculated based on risk of death. Thus, less risk means lower premiums. What’s more, premiums remain constant all through the policy term and does not increase with age. This translates to huge savings compared to buying the same policy later in life.
Don’t delay buying insurance
So, if you’re thinking of putting off life insurance, don’t! Because instead of saving you money, postponing your purchase would cost you more. In fact, not only will you be paying a higher premium when you’re older, you also miss out on the opportunity of building cash values early on. And if you have loved ones who rely on you financially, you run the risk of leaving them without any income replacement when you pass away.
Still unsure about life insurance? Talk to the experts. Call Mercado Global Insurance Brokers and we’ll help you sort out your needs and your plans. Together we can find the best insurance policy that works best for you and for the people who matter to you most.
