Insurance myths: Why Life & Disability Insurance are more important than you think
You insure your home, your car, and even your health—so why not your life and the income that supports it? Explore 4 common myths about life and disability insurance, and learn how this protection can benefit you.
Myth #1: I can do it myself.
Working with a professional can make the process much easier. A financial representative:
- Is trained to help you assess your insurance needs, your overall financial situation, your tolerance for risk, and the type (or types) of insurance that will work best for your unique situation.
- Will help you understand the complexities of insurance policies and riders, and will help explain the features and benefits right for you.
- May be a catalyst in the planning process, bringing together your other advisors (such as attorneys, accountants, etc.) to form a coordinated planning team.
- Will complete the forms necessary to start the underwriting process, and arrange for any follow-up tests or exams that may be required. They will also follow up with the underwriters to facilitate the process.
When the policy is issued, your financial representative will usually deliver it in person, explain the coverage, and answer any questions you might have.
They’ll continue to review your changing needs, and will be available to help with any service needs that may arise.
In the event of your death or disability, your financial representative will be a great resource to your family, ensuring that your claim is reviewed for benefits in a timely manner.
Myth #2: Insurance is too expensive.
Insurance is available for nearly every need and budget.
- A healthy 35-year-old male can buy $250,000 of annual renewable term life insurance coverage for less than $20 per month.1
- For just over $100 a month, he could also purchase a guaranteed death benefit for his lifetime.2
Individual disability income (DI) insurance may also be more affordable than you think. A policy can be designed to meet your needs, whether your goal is maximum income protection, safeguarding specific expenses (like a mortgage), or budget-based coverage. For example:
- If the same 35-year-old male makes $75,000 per year, he could potentially buy disability income insurance that would pay an after-tax benefit of $3,925 per month until age 65, should he ever become too sick or hurt to work.3
- He could buy that coverage for less than 2% of his annual income.3 That could be about the same amount spent on a monthly date night or cable bill.
Myth #3: I can wait to buy insurance when I need it.
You may think you’re saving money by delaying the purchase of individual DI insurance. But most DI policies let you lock in your premium, so you can take advantage of the lower rates available to you at a younger age.
Rates will increase as you age, and in some instances, you may reach a point when you’re no longer insurable.
Start small to lock in rates now. You can usually increase your coverage in the future. Your financial representative can help tailor a program that meets your budget and needs.
Myth #4: It won’t happen to me.
Of course, none of us want to think about an injury, disability, or illness happening to us. But if the unexpected happens, there’s peace of mind in knowing you’ll be financially ready.
DI insurance can cover your current income, as well as your retirement savings. It’s more than just extra protection—it’s a foundation for a more secure, stable future for yourself and your family.
1 Based on current rates and charges for a 35-year-old male non-smoker rated Super-Preferred. For specific information, please contact your financial representative.
2 Based on current rates and charges for a Principal Universal Life Protector IVSM policy for a 35-year-old male non-smoker rated Super-Preferred. For specific information, please contact your financial representative.
3 Disability income insurance calculations are based on a variety of factors. Disability income insurance also has limitations and exclusions. For specific costs and complete details of coverage, contact your financial representative.