Insurance can provide a financial safety net for you or your loved ones in the event of premature death, serious illness or being unable to work due to sickness or injury.
In spite of its importance, there are numerous myths and misconceptions surrounding insurance that can lead to confusion and, in some cases, put people off altogether. In this article, we'll debunk some common myths to help you better understand insurance and how it could benefit you.
Myth 1: I’m too young to think about insurance
One common myth is that life insurance is only necessary for older people. In reality, the ideal time to purchase life insurance is when you’re young. Premiums are generally lower for younger policyholders, and securing coverage early in life makes sure that your loved ones are protected in case of an unexpected tragedy.
Myth 2: Insurance in unaffordable
Contrary to popular belief, insurance can be surprisingly affordable. The cost of a policy depends on various factors, including your age, health, and the type of coverage you choose. Term life insurance, for example, is often more budget-friendly than whole life insurance. Plus, the peace of mind it provides is well worth the investment.
Myth 3: I have insurance through my employer, so I don’t need any more
While many employers offer insurances like death-in-service as part of their benefits package, it's essential to understand whether the coverage you’ve got is sufficient for your needs. Employer-sponsored policies may not be portable, meaning you lose coverage if you change jobs. It might be worthwhile having a personal policy that you can tailor to your specific circumstances, ensuring you and your loved ones are protected regardless of your employment status.
Myth 4: I’m single and have no dependants, so I don’t need insurance
Some people may believe they don't need insurance because they have no dependants. However, if you don’t have a secondary income to fall back on you’re going to be relying on your sole income even more. So, protecting some of your income through an income protection policy should be considered. Your circumstances and dependants may change in the future too, so getting insurance while you're young and healthy could save you money in the long run and can often be updated in the future to accommodate your changing needs.
Myth 5: I’m healthy, so I don't need insurance
Being healthy is a positive factor when it comes to securing insurance, but it doesn't mean you shouldn't have coverage. Accidents and unexpected illnesses can happen to anyone. Insurance policies can often offer more than just financial support. Some policies can give you access to additional benefits without having to make a claim. These benefits could be specific to your needs but often include things like access to a virtual GP, mental wellbeing support and bereavement counselling.
Dispelling these insurance myths is crucial for making informed decisions about your financial future. By understanding the realities of life insurance and debunking common misconceptions, you can make confident choices that line up with your unique needs and circumstances.
