According to the Insurance Information Institute, about 54% of people living in the United States have some kind of life insurance. This means that more than half of the population is covered in case of a serious health issue.
Unfortunately, it also means that a little less than half aren’t covered.
One of the biggest problems that consumers run into is deciding when to get life insurance. Many people don’t think that they need it until it’s too late.
To learn more about purchasing life insurance at the right time, we have created this guide for you. You don’t want to miss out on investing in family coverage for your loved ones.
Purchasing Life Insurance
The right time to purchase life insurance varies from person to person. The right time for you will depend on family circumstances and financial situations.
The first indicator that you should consider buying life insurance is if you have someone, anyone, who depends on you financially. Alternatively, you should invest in life insurance if you think that you might have any debt after your death. With insurance in these circumstances, you could leave your loved ones without a source of income or with a whole lot of debt for them to worry about.
More specifically, your age, your risk class, and your stage in life can influence when it’s best for you to purchase life insurance.
How Old Are You?
When it comes to purchasing life insurance, time is working against you.
People can get the most optimal rates when they are in their 20s and 30s, because this is when they’re young and have fewer risk factors. However, as you get into your 40s, 50s, and beyond, you will have to contend with higher rates. In fact, some insurance providers will even reject customers who are above a certain age.
According to Investopedia, insurance rates go up by 5% or more for every birthday you have. That means that if your monthly premium is $50 per month at age 30, it could increase to $63.81 per month just five years later.
There is no such thing as being too young to purchase life insurance. It’s a lot like saving for retirement. You may not feel like you don’t need it when you’re young, but the earlier you get started, the more you will benefit down the road.
What Risk Classes Are You In?
Ask yourself the following questions to get an idea of which risk classes you fall into.
- Are you younger (under 30) or older (over 40)?
- Are you female or male?
- Are you generally healthy or do you have preexisting conditions?
- Are you a non-smoker or a smoker?
- Do you work in a safe job or a dangerous job?
- What are your hobbies like? Do you like settling in with a good book, or do you spend your weekends skydiving and wrestling alligators?
If more of the first options apply to you, then you are at a lower risk, but you are high risk if more of the second options apply. A high-risk person may need to make life insurance more of a priority and purchase it at a younger age.
What Recent Milestones Have You Passed?
Many people purchase life insurance when they pass a significant milestone in life. The most common ones are marriage, the birth or adoption of a child, and taking out a mortgage on a house.
These are all major life changes where people realize they have something they want to protect. When you start a family, you want to make sure your loved ones will be okay even in the unfortunate event that something happens to you.
Additionally, some people actually choose to purchase life insurance as a gift for their children or grandchildren when they graduate. This is a perfect time to set up a safeguard for their future.
What Have Been Your Reasons Not To?
There is a needs gap of 16%, which is the percentage of people who say they need insurance but don’t have it.
If you are in the process of deciding when to purchase life insurance, there could be misconceptions that are holding you back. Let’s look at five common myths that cause people to procrastinate on purchasing life insurance:
For one, they are too busy or feel that it’s too complicated. On the contrary, a good insurance company will handle the complicated part for you. That’s what they’re there for!
Next, they worry it’s too expensive. Many Americans overestimate the cost of life insurance. Getting an insurance quote from a reputable company can show you how life insurance can fit into your budget.
Also, they think medical issues might prevent them from being covered. In the past, it was standard for insurance companies to require a physical exam. Today however, many no longer do so.
Another reason is they had coverage through their employer and have since left that job. This is why many people choose to purchase life insurance independently of their employer. Life insurance is something that you need to be able to feel sure of, regardless of what direction your career takes.
Finally, they had term life coverage that expired. Term life insurance does not last forever and must be renewed periodically. This form of life insurance is more affordable than whole life insurance (also called universal or variable insurance), but it has a finite duration. It’s important to make sure that your coverage extends as long as you need, such as until your mortgage is paid off or when your children have become independent.
Where to Find the Best Insurance Quote
If you take away one main message from this article, let it be this: The earlier you purchase life insurance, the better.
Few families ever regret buying the right kind of life insurance for their needs, so get in touch with Harris Insurance for a life insurance quote. They are a team of licensed experts who can work with you to set up a life insurance policy that will fit your unique needs.
LEGAL DISCLAIMER
Views expressed here do not constitute legal advice. The information contained herein is for general guidance of matter only and not for the purpose of providing legal advice. Discussion of insurance policy language is descriptive only. Every policy has different policy language. Coverage afforded under any insurance policy issued is subject to individual policy terms and conditions. Please refer to your policy for the actual language.
