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In today’s unpredictable world, life insurance stands as a cornerstone of financial security and peace of mind. Despite its undeniable benefits, a significant number of individuals still choose to go without this essential protection. To better understand this reluctance and bring light to common misconceptions, we delve into the top 10 reasons people often give for not having life insurance.

This article aims to break down the barriers and address common concerns that may prevent many people from obtaining life insurance coverage. From misconceptions about affordability to a lack of awareness, we will discuss the reasons behind this hesitancy and provide insights that may help individuals reevaluate their stance on life insurance. By demystifying the topic, we hope to emphasize the importance of life insurance as a vital part of any comprehensive financial plan, regardless of one’s stage in life.

They think they don't need it.  

This is a big one, even after eliminating those in #2. I recently spoke to a father of 5 young children who rejected my offer because he “just didn’t see a need for life insurance.” I asked him how his wife would be able to support his 5 kids if he passed away and they could no longer depend on his income.

The bottom line is anybody who has a spouse (or significant other) and/or children that depend on his/her income should have life insurance. There are other personal and business reasons for buying life insurance, but this one seems to be the biggest reason.

They really don’t need it.


People who don’t have families dependent on their incomes usually don’t have a need for life insurance (unless they want to take advantage of the living benefits of a permanent policy, such as whole life or universal life insurance). If there are no other needs, such as business continuation, estate protection, or paying for final expenses, then they shouldn’t purchase a policy. Any life insurance agent or broker worth his/her salt will not sell a policy to someone who doesn’t have a clear need for it.

They think they can’t afford it. 


 Either they overestimate the cost of a policy or don’t consider that, with a minor shift in one’s budget, affording a policy is not an issue. In the overestimating category, the 2014 Insurance Barometer Study done by LIMRA and LifeHappens.org says it all:

While 2 in 3 consumers say life insurance is too expensive to purchase, people tend to overestimate the cost. In fact, a quarter of the respondents thought the price for a $250,000 term policy (that would cost $150 per year) would cost at least $1,000 annually.

In the budget-shifting category, let’s double the premium of the policy mentioned in the last paragraph to $300  annually, which would purchase a $650,000 20-year term policy for a healthy 30-year-old male. 

If this gentleman has a family and tells me he can’t afford a policy, my first question is, “How much do you spend at Starbucks (or other coffee emporium) every morning?” If the answer is $3  or higher, I show them that if they cut back on the daily java drinks, they can easily afford that policy. If they don’t indulge in a daily caffeine treat, I can usually find other places to find $25 dollars a month to protect their families financially.

In Reality, these are the reasons they won’t buy Life Insurance:

  1. They really can’t afford it. Yes, sadly, it’s true – there are people who can’t afford to purchase even the smallest policy (no matter how hard I try to find it in the budget). I have seen these numbers grow since the Great Recession began. Hopefully, these numbers will see a reversal in the near future.
  2. They procrastinate.  Okay, I know that some people would rather do anything than confront the subject of one’s mortality, but if you fall into the Need it category, you just need to bite the bullet and get it done. Because it’s so easy to procrastinate doing something so lacking in excitement and sex appeal, a big part of my job is nudging my prospective clients and applicants along in the process until they have a policy in hand.
  3. They forgot to pay the premium and let the policy lapse. This one baffles me. Why would you go through the application and medical exam process and lose the policy (and all the money you’ve spent on it to date) just because you forgot to pay the premium? Setting up a checking account debit with the insurance company is a foolproof way to ensure your premiums are paid.
  4. They’d rather have a root canal than speak to a life insurance agent.   I’ve been to one too many insurance company conventions and meetings, and I can’t say I disagree with this one. However, all kidding aside, I’ve met some really great people in the business as well, and most I’ve met care a lot about doing the right thing for their clients. In most cases, life insurance agents/brokers like to help people (albeit sometimes too aggressively, I confess). You can shop for your agent/broker to find one you’re compatible with. Start with one of the many online independent agents.
  5. They want to buy it, but they are extremely confused about the subject. There is a lot of information out there about the subject and a lot of opinions (e.g., the right type of policy to buy, how much coverage is needed, etc.), so it’s easy to get overwhelmed with information. This is a great example of too much analysis leading to paralysis. As a result, many folks start out to purchase a policy and wind up throwing their hands up and quitting the search. My suggestion is to find an advisor you trust and seek his/her advice.
  6. They applied but didn’t take the policy because they didn’t agree with the health class assigned by the insurance company. I wish I could say I made this one up, but a lot of people get really upset when the insurance company puts them in a lower health class than they think they deserve. Unfortunately, it begins with unrealistic expectations created by a quote they received. Not everyone is in the best health class, and it’s extremely important to get the most accurate quotes upfront so you don’t get disappointed when the policy is issued.
  7. They just aren’t interested in securing the financial future of their families.  Thankfully, I don’t hear this one a lot, but I have to include it on the list because I do run into people with this viewpoint from time to time. One charming “gentleman” said to me, “I’ll be dead, so I won’t have to worry about it, will I?” That’s one objection I won’t even try to overcome because, frankly, I don’t want to spend more time than I have to with someone like that, let alone try to sell him a policy.

If you fall into any of the categories mentioned above, we encourage you to speak with an experienced and reputable independent insurance professional. An experienced life insurance agent can help you understand how you affordably protect your surviving loved ones if you should die unexpectedly, and in most cases, your monthly premium will be less than feeding a family of four at a diner each month. Call us at 866-868-0099 during normal business hours or contact us through our website 24/7.

Frequently asked Questions

Why do some people think life insurance is too expensive?

A common misconception is that life insurance is unaffordable for the average person. However, many term life insurance policies offer affordable premiums, especially if purchased when the individual is young and healthy. Shopping around for competitive rates and working with an insurance agent can help find a policy that fits within one’s

Do some people avoid life insurance because they believe they don't need it?

Yes, many individuals may feel they do not need life insurance because they are young, single, or do not have dependents. However, life insurance can still serve essential functions, such as covering outstanding debts, funeral expenses, and providing financial support for loved ones in the event of an untimely death.

Is the complexity of life insurance a deterrent for potential buyers?

Life insurance can seem complicated, with various policy types and coverage options, which may deter some from purchasing a policy. Working with a trusted insurance agent or financial advisor can help clarify the different policies, address concerns, and simplify the process of obtaining life insurance coverage.

Do some people avoid life insurance because they don't trust insurance companies?

Trust issues or negative experiences with insurance companies can be a factor in avoiding life insurance purchases. However, it’s essential to research and compare reputable companies, read customer reviews, and consult with a financial advisor to find a reliable and trustworthy insurance provider that meets your needs.

Term Life Insurance Quotes

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Richard Reich
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