Buy Life Insurance

On our website we discuss the reasons why you should buy life insurance, and a list of the best sites for obtaining affordable life insurance.

For many during these troubled times, the question of purchasing a life insurance policy generally takes a back seat to other more pressing issues (like finding a job, or paying the mortgage).   Is putting the issue aside the best approach?  Let’s take a look at the argument for Buy Life Insurance.

If you want some informed opinions regarding the need for life insurance, approaching a seasoned life insurance agent is probably the best tactic.  Sure the agent will be motivated to convince you, but they are also the most experienced with regard to the risks associated with no coverage (or inadequate coverage).  In other words, they are the best to make the case for purchasing life insurance.

So, why should we buy life insurance? Let’s go through the reasons.

1.   When someone unexpectedly passes away, the burden falls upon the immediate family to bear the expenses for any existing debt (like a mortgage), and burial costs.  Taking out a small term life insurance policy to cover these known items would be a big help to family members; especially during the stressful period of having lost a family member.  And the cost for a term life insurance policy is likely to be very small for a young person.

2.   If you have a family, especially with children, there should be some coverage for the income earners (to ensure that earnings lost due to death are covered).  This will help the family to continue on without a major financial change or impact to their lives. 

3.   If you are currently uninsured, you face the possibility of becoming uninsurable due to health changes.  When you have a life insurance policy, you pass the risk of your death onto the insurance company; when you are uninsured, you assume the risk of becoming uninsurable (when this occurs, you will not be able to get life insurance or it would become prohibitively expensive).

4.   If you have trouble saving for retirement, purchasing a permanent life insurance policy is a form of forced savings, plus your family will receive the benefit of insurance to protect your future earnings.

The true impact of being uninsured usually occurs when someone you know dies suddenly (usually due to an accident).  For many, this is a wakeup call.  They see firsthand the financial impact on the family: the rush to get funds for the funeral; the concern over mortgage payments; the inability to continue with their lives due to lack of income. 

If cost is the issue, then you should do price comparisons on Term life insurance policies, which can be surprisingly affordable.  You can generally qualify for a term life insurance policy without a medical exam, with terms of 10, 15, 20, or 30 years.  And of course, there is the one year renewable plan.

If you are young and healthy, you can opt for an underwritten Term life insurance policy, in which a medical exam is required.  This will provide you with the lowest cost of insurance. 

If you prefer not taking the medical exam (and paying a higher premium), then the next step up would be a simplified issue life insurance policy.  This type policy simply requires submitting information about your medical history (be sure it’s complete and accurate), but does not require an examination.

For those who are not interested in providing any medical history or submitting to a medical exam, the guaranteed issue Term life insurance policy is available at a higher premium.  With this plan, you simply provide basic information in the application.

If you do opt for the underwritten policy and a medical exam, here are some suggestions to follow prior to the examination:

·    Make sure you get sufficient sleep the night before the exam

·    You will be advised not to drink any fluids for eight hours prior to the exam; especially caffeinated beverages such as coffee, tea, or coke.

·    Keep to a minimum the consumption of salt and foods high in cholesterol for 24 hours prior to the exam

·    And, don’t perform any strenuous activities (like going to the gym) for 24 hours prior to the exam

Is it wise not to buy life insurance?  I think this article shows that it would be prudent to at least investigate the issue before it is too late.