Don’t get the wrong idea about your life insurance.
While most people understand the need to secure life insurance coverage, they don’t know very much about the specifics of this coverage. Naturally, may misconceptions and mistruths abound. To ensure that you aren’t making incorrect assumptions about your life insurance coverage, here are some of the things that you should know.
Life Insurance is NOT a Luxury
Many people do not get life insurance because they assume that it is very expensive. However, studies have shown that the average American overestimates the cost of life insurance—assuming it is three times more expensive than it is in actuality. This means that there’s a good chance that life insurance is actually far cheaper than you ever imagined. So, even if money is tight, you should still shop for quotes. You may be surprised by how affordable it is to protect your family’s financial future.
Employer-Offered Life Insurance Coverage is NOT Adequate
Many employers offer life insurance benefits to their staff. While this is a nice perk, many people make the mistake of assuming that this employer-offered coverage is enough. Unfortunately, this is far from the case. For starters, financial experts recommend securing life insurance coverage worth at least seven times your annual salary. As employer-offered life insurance policies only offer about two times your yearly salary, this coverage is far from adequate. Additionally, when you rely solely on life insurance through work, you risk losing your coverage if you switch jobs or get fired. Rather than relying on this insufficient and potentially risky coverage, you should secure a personal life insurance policy where you can choose your coverage amount and term length. Your employer-offered life insurance should be treated as a supplement to your policy, but nothing more.
Life Insurance is NOT Just for Funeral Expenses
Many people have the misconception that life insurance is designed to pay for funeral and burial expenses. While it’s true that your life insurance benefit can be used to cover these costs, this is not the only thing your coverage can do. Your life insurance can be used to pay off your debts, replace your income, keep up with recurring financial responsibilities, and take care of routine costs. Additionally, you can use your life insurance to fund your children’s future education, give back to charity, protect your business, and so much more.
Don’t make incorrect assumptions about your life insurance. Do you have additional questions about your life insurance coverage? If so, then contact the experts at Scautub Agency in Scotia, New York today.