There are many myths about life insurance. A lot of them are simply misconceptions about who life insurance is for and when you should get it. In this list, we wanted to clear some of them up to have you much better informed about life insurance.
7 Common Misconceptions About Life Insurance Policies
1. It’s only for those with a mortgage + a mortgage requirement 🏠
A big life insurance myth is that life insurance is only for those with a mortgage. There is no doubt that a mortgage is a big reason to get insurance, as being mortgage-free after someone has passed away can be a huge financial relief. Policies without a mortgage attachment can also be very affordable.
There is no legal requirement to get life insurance when you get a mortgage. A mortgage provider may ask you to get it or recommend a provider, but there is no law for this. However, while it’s not a legal requirement, both life and buildings insurance may be a prerequisite before a lender accepts your mortgage application due to their own policy.
2. I’ll need to complete a medical exam 💉
Many people think that a medical exam is a requirement. In truth, medicals for life insurance were a requirement for such a long time, but things are changing. For example, we only ask around 15-18 questions (depending on your answers) about your medical background, with no in-person medical exam.
3. I don’t need life insurance if I’m not the highest earner 💷
Let’s look at an example of a household with two adults and three children. One adult works in full-time employment, while the other looks after the children. Many people feel that it’s sensible for the person in full-time employment to get life insurance, which is true. Without their income, the family might not be able to cope. Where you could be wrong, is thinking that it’s only the partner working full-time that needs life insurance.
If the mum or other parent/caretaker who looks after the kids passes away, who would look after the children? It could cause stress, and the possibility of the earner needing to leave employment due to childcare needs. Every family is different but it makes sense for both adults to get life insurance.
4. It’s not for young people 🌱
There are a ton of life insurance adverts directed to older generations. But really, you can never be too prepared and anything can happen, regardless of how old you are. Millennials! Be aware! The earlier you purchase life insurance, the cheaper your premiums will be (in general), and the more you save over time (it’s thousands of pounds! 🤯)
5. Insurers will find a way to NOT payout 💸
The terms and conditions of a life insurance policy will always be laid out in black and white. You may have heard some stories, but if you are completely honest when signing up for a policy, you shouldn’t have anything to worry about. And did you know that on average, 98% of life insurance polies are paid out.
6. It’s an unnecessary expense ❌
It's tempting to think that the money paid to a life insurance policy could be spent elsewhere. As with all types of insurance, you're protecting yourself from something that you hope will never happen. Death, however, unfortunately, comes to us all. While insurance may not be for everyone (maybe you’re a single 21 year old without any assets) but for the majority of people, it can give them peace of mind.
7. I can’t get life insurance ⚕️
If you do have a health condition or are a smoker, for example, then there is also a misconception that you won't be able to get any life insurance at all. In reality, while there is a possibility you will have higher premiums than someone with no health issues, you should be able to get life insurance. Being pregnant can also be another reason people avoid trying, don’t let that be your reason.
Life insurance is not always as expensive as you may think
Have any doubts about life insurance? If so, it’s best to ask than assuming the worst. People are often pleasantly surprised at the low cost of premiums. If you need some more information about how it works, check this article out, “What Is Life Insurance and How Does It Work?”.
Life insurance at Bequest
We offer term life insurance policies for up to 40 years, with up to £500,000 per payout. Starting at only £6.70/month for young, healthy adults. If you want to ask some questions, we are always happy to help! You can email firstname.lastname@example.org and we would love to answer any questions you may have.