Why buy life insurance?

Why buy life insurance? In short, love. When your loved ones lose you, you do not want them to have to deal with an unnecessary financial burden as well. The earlier you buy life insurance, the cheaper it will be. The average rate for a term life insurance policy for an individual in their 30s is about $16 per month. Once that individual reaches their 40s, they can expect to pay about $22 per month. Compare rates now.

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent

UPDATED: Jul 19, 2021

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Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance company and cannot guarantee quotes from any single company.

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Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.

Quick Facts

  • There are multiple premium payment schedules for life insurance.
  • It may be a good idea to get life insurance even in your 20s.
  • Most people get life insurance once they have started a family.

Why buy life insurance? Because you need to know your family is going to be alright. You never know when you will pass and you don’t want your family worrying about money when it happens. Click the link to compare life insurance.

Get a good start on finding peace of mind by typing your ZIP code into our helpful tool above to find affordable life insurance rates in your area.

What is the main reason for buying life insurance?

If there’s one primary reason for the existence of life insurance, it’s devotion to loved ones. No one wants to lose a loved one, and no one wants their loved ones to have to deal with a potentially unneccesary financial burden in the event of their death.

Let’s take a look at some rates for life insurance based on payment schedule to see what this peace of mind costs you.

Average Life Insurance Rates Based on Payment Schedule
Payment ScheduleTotal Premium DueAverage Rates For
Billing Period
Total Premium Paid
Annual Payment$1,000.00$1,000.00$1,000.00
Semi-Annual Payment$1,000.00$520.00$1,040.00
Quarterly Payment$1,000.00$265.00$1,060.00
Monthly Payment$1,000.00$87.50$1,050.00
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While on the surface this looks substantial, just keep in mind that the pain and suffering your loved ones would feel if they were saddled with debt along with your death would be exponentially higher.

The bottom line is that you have to weigh costs. There are financial costs and personal costs, and you have to find a balance. Let’s talk about whether life insurance is right for you. You can also click the link to see our Life Insurance Rates Comparison Chart.

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Is it worth it to buy life insurance?

If you have loved ones who are dependent on you, life insurance is well worth spending money on.

Why buy life insurance young? Let’s take a look at a video from CNBC.com about why it may be a good idea to buy life insurance at a younger age than you anticipated, perhaps even in your 20s.

Why buy life insurance early?

With the prevalence of student debt, mortgage worries, and the like, life insurance may not seem like a top priority. CNBC states that the life insurance policy has a special benefit when it comes to student loan borrowers.

The policy acts as a shield for your loved ones if you pass while still owing on your student loans. Federal loans are discharged upon death, private loans are not. Therefore, the co-signer of the private loan would be on the line for repaying this loan.

The bottom line is, you don’t want the prospect of paying back your student loan to add to your loved one’s stress at the time of your death.

Let’s move on to learn more about why life insurance is important.

What is the point of life insurance?

As we’ve said, life insurance exists to provide a sense of security and peace of mind for someone should the worst happen.

This peace of mind primarily comes in the form of having one’s loved ones financially taken care of should they pass away suddenly, a risk we all run.

Why buy life insurance over 50? Maybe you shouldn’t. It all depends on your situation.

Without dependants, life insurance may not be worth it. With dependents, life insurance almost becomes a must. No one likes to have their mind feel uneasy.

If you are asking:

  • Why buy life insurance now?
  • Why buy life insurance for a baby?
  • Why buy life insurance for a child?
  • Why buy life insurance for grandchildren?

The answer is it’s never to early to prepare for the future. 

Why buy life insurance outside of work from your own life insurance company? It’s a great perk when you employer offers life insurance but it may be wise to supplement that coverage with your own coverage.

Things like a change in job, the birth of a child, or the loss of a loved one can impact your financial future. Make sure you are ready.

Before you buy life insurance, make sure you compare life insurance quotes from multiple companies.

Feel free to type your ZIP code into our free tool below to find reasonable rates for life insurance in your area.

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Frequently Asked Questions: Why buy life insurance?

Still have questions? Keep reading to learn more.

#1 – Why is life insurance a bad investment?

In particular, whole life insurance is a bad investment because it is over 10 times more expensive than term life insurance and most people don’t even need it.

#2 – When should I get life insurance?

Usually, the best time is when you start a family.

#3 – Who needs life insurance most?

The general rule is that it is necessary if you have dependents.

#4 – What are the pros and cons of life insurance?

The pros are that it will pay a benefit, it has predictable premiums, it serves as an asset, it may pay dividends, and it has tax advantages. The cons are that it can be expensive and it can be complex.

#5 – Why do we need insurance?

The primary benefit of insurance, particularly life insurance, is peace of mind that you and/or your loved ones will not experience financial hardship in the event of a catastrophic event.

#6 – What is a good rate for life insurance?

The average rate for a term life insurance policy for an individual in their 30s is about $16 per month. Once that individual reaches their 40s, they can expect to pay about $22 per month.

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