Here’s what to know about buying life insurance
From CNBC: 2024-06-25 08:33:01
Fewer Americans are buying life insurance, with coverage falling to 52% of consumers in January 2023 from 63% in 2011, experts say. The trend has been a steady decline since the 1970s due in part to rising costs, debt burdens, and a delay in key life milestones like marriage and children that typically trigger life insurance purchases.
Consumers should consider their financial situation and lifestyle goals to determine if they need life insurance to cover expenses like funeral costs, debts, or ongoing expenses in the event of their death. Single people without dependents may still benefit from coverage, according to advisors, who recommend term insurance for most buyers due to its fixed premiums and specific term lengths based on financial obligations.
While permanent life insurance like whole or universal policies offer lifelong coverage and cash value opportunities, they tend to be more complex and costly than term policies. Consumers are advised to carefully consider their needs and avoid purchasing policies they do not fully understand to ensure they are adequately protected in the event of their death. Experts recommend assessing financial needs and coverage gaps to determine the right amount and type of life insurance that best suits individual circumstances.