10 Top Myths About Life Insurance Busted

Sep 1, 2021 4 min read

When it comes to protecting your family, finding the right strategies to prepare for the unexpected is an important step. Life insurance is a big part of creating a strong financial future. But from deciding which type of policy fits your needs to how much coverage to buy, purchasing life insurance can feel overwhelming. Additionally, the many myths out there can add confusion to the process and ultimately, prevent people from getting the coverage needed to protect their families’ financial futures. It’s important to recognize the myths and know the truth before making a decision to purchase or not purchase coverage.

Check out these ten common life insurance myths and the truth behind them.

Myth No. 1: Life Insurance is Too Expensive

BUSTED: According to the 2021 Insurance Barometer Study by LIMRA and Life Happens, more than half of Americans overestimate the price of life insurance by as much as three times the actual cost, and 44% of millennials overestimate the cost by six times.

The truth is life insurance is typically less expensive when purchased when you’re young and healthy. Term Life insurance is generally an inexpensive option. You may be able to lock in the coverage you need for as little as a dollar a day.

Myth No. 2: Only Families with Young Children Need It

BUSTED: Life insurance can be the foundation of financial security for your family or business – at any stage of life. Proceeds from a life insurance policy can help cover outstanding debt, like a mortgage and credit cards, or fund financial objectives, including retirement or college savings.

Did you know there are options for how a policy pays out the death benefit? Our Income Guard Term Life coverage provides set monthly benefit payments to help your loved ones stay on their feet and continue to cover regular expenses.

Myth No. 3: Children Don’t Need Life Insurance

BUSTED: With bright futures ahead, you want to be sure your children are prepared to create a strong foundation for the future.  Buying life insurance for children now, while they’re young and healthy has several benefits. First, it can help guarantee their insurability to ensure they will have coverage as an adult, even if they become uninsurable. Second, it can help save on premiums. Third, certain policies like a permanent life policy, builds a cash value that can be used later to help pay for college tuition, a down payment on a house, etc.

Myth No. 4: I’m Young and Healthy and Don’t Need It Right Now

BUSTED: Buying life insurance when you’re young and healthy is best! You can benefit from lower rates and also ensure that you have the coverage — and financial security — you need for the long haul.  Purchasing coverage while you’re young, can help you gain guaranteed insurability for when you’re older.

Myth No. 5: The Life Insurance I Purchase at Work Is Enough

BUSTED: Any type or amount of coverage is a great start. Especially, if your employer provides it at no cost or a low cost. However, it likely isn’t enough coverage. According to the U.S. Bureau of Labor Statistics, the median life insurance coverage provided by an employer is either a flat $20,000 or one year’s salary. Would that be enough for your loved ones not to struggle financially? For many the answer is no. The Barometer Study found 42% of families would experience financial hardship within 6 months of a wage earner’s passing.

Nearly 4 in 10 insured consumers wish they had purchased their policies at a younger age. Having an individual policy in addition to your work provided coverage, also guarantees you’ll continue to have life insurance coverage even if you change jobs. Employer provided policies may not be portable.

Myth No. 6: Term Insurance Can’t Be Converted to Permanent Coverage

BUSTED: Many term policies are renewable and convertible to a permanent policy. After holding your term policy for a set period of time, it may be possible to convert it with a special premium credit. The credit helps offset any increase in premium costs and may waive the usual health assessment.

Myth No. 7: Stay-at-home Parents Don’t Need Insurance

BUSTED: It’s easy to think that life insurance coverage is only needed if your family depends on your income, but that idea puts many families’ financial stability at risk. If you’re a stay-at-home parent or you care for an aging family member, it would take a considerable amount each month to replace the support you provide. A life insurance policy like Income Guard Term Life can help ensure your loved ones would have monthly income to pay for the care you provide.

Myth No. 8: Life Insurance is Only Used for the Death Benefit

BUSTED: It’s common to think of a life insurance policy as only paying out a death benefit but some policies offer ways you can use your coverage while you’re still living:

  • The cash value from a permanent life insurance policy can provide supplemental income for retirement.
  • By adding the Daily Living Rider to your term or permanent policy, you can access part of your policy’s death benefit should you become chronically ill.

Myth No. 9: It’s Too Difficult to Buy Life Insurance

BUSTED: The Barometer Study found nearly half of consumers said they were more likely to purchase life insurance with simplified underwriting, and more than half said the possibility of not seeing a doctor or going through a paramedical exam was appealing.

And with accelerated underwriting if you’re 18-60 years old and applying for coverage up to $500,000, you may qualify to skip the medical exam and testing.

Myth No. 10: COVID-19 Impacts Life Insurance Death Benefits  

BUSTED: False. Our life insurance policies do not contain a pandemic or vaccine exclusion. As long as your life insurance policy is active and in good standing, a COVID-19 related cause of death would not prevent your beneficiary(ies) from receiving your policy’s death benefits.

Are You Protected?

Don’t let these myths keep you from not having the coverage you need to protect yourself and your loved ones. Working with a Farm Bureau agent to find a policy that fits your needs and goals makes the process easy. Contact your local Farm Bureau agent today to help create a solid financial foundation.  


Individual eligibility for all product promotions is subject to underwriting and approval. Estimated premium payment is for 20-year Choice Term Guaranteed Premium Plan; Standard; 35-year-old male or female; non-smoker. Amount is for demonstrative purposes only. Contact your Farm Bureau agent for a quote on your actual monthly premium payment.


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