People often purchase life insurance because they want their dependents and other loved ones to be taken care of if the unthinkable happens. However, life insurance is often misunderstood. Consider the truth behind these common myths before making any major life insurance decisions.

Although some young adults purchase life insurance policies with the expectation that their needs will stay the same, most people find that their insurance needs change over time. For example, someone who gets life insurance while single may find that their needs change drastically after marriage and children. They may then obtain a completely different policy.

Myth: No-Medical Policies Are More Desirable

Sometimes no-medical policies are worth it, but they will probably cost more. Getting life insurance without having to get a medical exam can seem appealing — especially if you're worried about your family's medical history. However, the insurers are taking on a greater risk by insuring you, which means these policies will cost a lot more and might not be the most beneficial.

Some couples only purchase life insurance for the primary breadwinner. However, this mistake drastically undervalues the role of both spouses in the home. Life insurance is needed for both people. After all, if someone is no longer providing the necessary services to keep the household running smoothly, that can have a big financial impact, too.

Life insurance is a smart choice for most responsible adults. However, it should rarely be a priority over other necessities. For example, when a person has to choose between health insurance for their family and life insurance, health insurance may win. If you have enough money in a savings account to cover any final expenses, then life insurance may not be a must.

If you lie on insurance forms, you are making a potentially costly mistake. Even a white lie can lead to the cancellation of your life insurance or higher monthly premiums. In addition, if an insurance company discovers a lie after your death, then the company could possibly reduce or completely cancel your death benefit. Never tell small or big lies on the application form.

Life insurance policies are designed to provide a specific service. For example, the policy may replace the lost income that the deceased person is no longer earning and cover final expenses. However, most life insurance isn't the best possible investment. If a couple is healthy, they may not choose to invest their money in life insurance when a sum could earn more money in the bank.

When you're ill, it can be difficult to buy life insurance. Never wait until you're sick to try to get coverage. Instead, you might need to strategize a way to cover the things that life insurance traditionally covers. For example, make sure that you have enough in savings to cover the type of memorial service you'd like, so you won't have to scramble to try to get coverage in such a difficult situation.

People often assume that insurance coverage is more attainable as people age. Unfortunately, older people often find it challenging to get insured at a fair rate. Partly because people are at a greater risk of developing costly illnesses as they age, insurance companies may charge high rates for elderly people seeking life insurance.
Finally, take the time to consider the truth behind life insurance myths before deciding what's best for your unique insurance situation. If you have a life insurance policy with escalating premiums, contact Habersham Funding, LLC to see if a life settlement option may be the right solution for you.