Why Term Life Insurance Gets a Bad Rap

UPDATED: Mar 26, 2020

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Life insurance isn’t one of those topics you typically hear people talking about at cocktail parties or while making conversation with the guy or gal next to you on the treadmill at the gym. In fact, most people don’t like to talk about it at all.

Much of that has to do with people’s many misconceptions about life insurance. And term life insurance, in particular, gets a bad rap.

But don’t believe everything you hear on the street.

There Are Plenty of Myths About Term Life Insurance that Aren’t Entirely Accurate.

Myth #1: It’s Too Expensive

Term life insurance is an affordable type of life insurance offering coverage at premiums often significantly less than those for whole life policies. That’s because it’s so flexible. You can choose the length of the time (the term) your policy will be in effect. Typical term periods are 10, 15, 20, 25, or 30 years. The term period locks in the policy cost for that specific time and your rates will not increase at any point during the term.

Myth #2: It’s Not Necessary

According to statistics provided by Lifehappens.org, 31% of people say they would feel the financial impact from the death of their household’s primary wage earner in just one month.

If anyone depends on you financially (spouse or partner, children, aging parents…), life insurance can help them make ends meet if anything were to happen to you and your income would no longer be there. Funeral costs alone can be a hardship. According to the National Funeral Directors Association, the median cost of a funeral in 2012 was $7,045, which doesn’t include the cost of a monument, cemetery fees, and the approximately $1,000 for a vault.

Then factor in other obligations such as mortgage or rent payments, car insurance, car loans, higher education, utilities, groceries, medical expenses, etc. It all adds up quickly.

A term life policy can help ensure your loved ones are financially comfortable after you’re no longer there.

Myth #3: It Doesn’t Offer Coverage For As Long As You’ll Need It

It’s true that term life insurance doesn’t last forever. It has a fixed term that when expired no longer provides coverage. But you have the option to select a term length that’s realistically plenty long enough to cover you throughout the rest of your lifetime or at least until others won’t be as dependent on you for their financial well-being. Most modern term life policies do not technically expire until age 95. And most term life policies can—up until a certain time—be converted to permanent life insurance policies.

Term Life Insurance: A Friend not a Foe

So you see, because of its flexibility and affordability, term life insurance is one of the good guys. Plus, you can find out how much a policy will likely cost you by getting a quote conveniently online. Of course, you’ll want to do your homework before deciding which type of life insurance policy to apply for. Consider checking in with a trusted insurance professional to help you determine what’s best for you and your family.

Tim Bain

Tim is a licensed life insurance agent with 23 years of experience helping people protect their families and businesses with term life insurance. He writes and creates stuff for QuickQuote and other insurance and financial websites. You can find him on Twitter.

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