September is a popular month to purchase life insurance — here’s why

Posted: 11 September 2020 3:37 pm
News

Life insurance awareness month logo from Life Happens

We sat down with the CEO of Life Happens to discuss Life Insurance Awareness Month — and why it’s resonating more in 2020.

At its core, life insurance is a simple product: It protects your loved ones financially when you’re gone. But there is a lot of confusion around this type of coverage, with many people thinking it’s more expensive or complicated than it actually is.

September is Life Insurance Awareness Month, an initiative run by Life Happens — a nonprofit dedicated to educating consumers about the value of life insurance and other aspects of financial planning. And with all the uncertainty surrounding the COVID-19 pandemic, the initiative is hitting a chord this year.

Finder sat down with Faisa Stafford, president and CEO of Life Happens, to discuss how the initiative has changed in light of this year’s events — and to clear up the most common myths about life insurance.

What’s the goal of Life Insurance Awareness Month?

Life Insurance Awareness Month is an annual initiative to remind Americans about the importance of life insurance in a sound financial plan. Since 2004, we’ve highlighted this month to encourage Americans to start having important conversations around leaving a legacy and protecting their loved ones.

Does September have any significance in the life insurance purchasing cycle?

Life Happens wanted to have Life Insurance Awareness Month (LIAM) be during a month that resonated with what people were doing. We picked September since that is a time when parents are sending their kids back to school, cleaning up after the summer whirlwind and have a moment to think about finances and long-term goals. Of course, this September means even more to the LIAM campaign seeing how the pandemic has made us all reevaluate our finances and our need for life insurance.

Why is now the best time to consider buying coverage?

This year has been a wake-up call for all of us. We’ve learned firsthand that we need to be prepared for the unexpected in all areas of our life, which is why financial security has never been more important. That’s also why this year’s Life Insurance Awareness Month theme is Reality Check: The time for life insurance is now.

COVID-19 is this invisible threat that has made us all very aware of our own mortality. So far, no one can know if they would be more susceptible to the virus or be that person who never even knew they were infected. There is no rhyme or reason to it, and it reminds us that we aren’t invincible. That is why we start looking for proactive ways to protect ourselves and our loved ones. We use masks and sanitizing wipes. That is also why we are seeing people looking to life insurance as another protection product.

According to the latest Life Happens research, the pandemic has sparked not only more conversations in almost a third of American households around life insurance coverage but has also prompted a quarter of Americans to purchase life insurance for the first time.

The financial peace of mind that comes with purchasing life insurance is so important, especially when we have people who depend on us and our income. No one wants their loved ones to be left to worry about how to pay rent or car payments, or even for groceries. Being financially prepared is an easy step people can take today from their homes to both safeguard their loved ones and their futures.

What are some of the biggest myths about life insurance?

With the sheer amount of questions, information and uncertainty out in the world, it’s easy to get overwhelmed and not know what to believe or where to start with life insurance.

One popular myth is that if you’re single or don’t have children, you don’t need life insurance. Even if you don’t have a spouse or dependents, life insurance benefits can be used to help your loved ones pay off your debts (like private college loans, for instance) if you pass away.

Our 2020 Insurance Barometer Report found that before the pandemic, 42% admitted they didn’t purchase life insurance because they didn’t want to face their mortality. However, there has been a crack in these misconceptions. Our most recent consumer study, “Tough Talks During COVID-19,” found that a third of Americans are talking about their end-of-life plans and 69% agree they need to have more financial discussions with their loved ones.

The pandemic has been a wake-up call to us all and made life insurance a new topic to bring up at the dinner table. At Life Happens, we find value in helping educate consumers about life insurance’s essential value, as many people truly need more life insurance than they have and are looking for the certainty they can get with life insurance.

There’s also an incorrect belief that life insurance is expensive. The Barometer report also found that half of Millennials, for example, believe the estimated yearly cost for a $250,000 level-term life insurance policy for a healthy 30-year old is $1,000 or more, when in actuality it’s closer to $160 per year, which is only around $13 a month. That’s the same price as your Netflix subscription or just three coffees! That is why financial education is so essential so that more families can obtain the financial security they need, especially in today’s world.

Have any new initiatives been introduced for 2020?

We’ve proudly partnered with Brooke Shields for a second year to help share the message during Life Insurance Awareness Month of why Americans need to protect their families and loved ones with life insurance. Brooke is passionate about staying educated and being financially prepared, and wants to ensure other families are financially protected for the future as well.

Before you purchase a policy, compare life insurance companies to make sure you’re getting the best coverage at the lowest possible price.

Photo: Supplied

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