If you are young and healthy and think you may want health insurance in the future (for future spouse, kids), buy term that goes into your 60s, NOW from a major insurer. It will be cheap, even with age related rate increases.If there is inflation, you’ve locked in today’s prices. Once you get past 40 or if you develop a condition that insurers don’t like such as anything heart related, high blood pressure, diabetes or are diagnosed with any sort of mental illness including mild depression or anxiety (if you take an SSRI or sedative for any reason, that counts) they simply won’t take you and you’ll be stuck with the poor choices mentioned in this post, if you want it. If you’ve already got term when you develop one of these conditions, keep paying and you’ll still be insured. Don’t rely on employer group coverage, you may lose that job and that insurance along with it and your next job may not have it. Even if you think your savings will cover a death benefit, there is another reason to get life insurance–end of life care. Get a policy that has a viatical clause, which allows you or your family to draw on the insurance payout before you die if you are terminal. Health insurance doesn’t pay for hospice or home hospice care which can get expensive. If you have this kind of policy, at least you’ll have a choice that won’t be weighed down as much by financial considerations.

thanks for mentioning that paying premiums in full, rather than on installment plans, can save big…Our combo of life insurance, umbrella liability, boaters’ insurance and STD/LTD is $1200/year – or roughly $120/month if we were to choose the installment method…= savings of $240/year by paying-in-full. We have a sinking fund for this that gets $100/month in our budget…

To piggy-back on Maggie’s comment – my term life insurance as a 35-yo, non-smoking female, for $200K is $500 a year BECAUSE I have a depression diagnosis + attendant wellbutrin prescription from 8 years ago, with no problems since. My best friend, same age, no health problems, has the same coverage from the same company for $240.

Life insurance is not necessary unless you have a spouse and dependants that need your salary and skills for day-to-day living. The breadwinner is often the only person covered but that isn’t wise. The stay-at-home parents need a policy that financially covers child rearing and other tasks performed that a single parent would need to hire outside help to do.

Of course, you can self insure by living frugally to save enough money BEFORE you need life insurance.

My favorite tips are
* figure out if you actually need life insurance (I don’t)
* look for offerings from your job and organizations you belong to
* pay more up front if you can save money

If I did need life insurance, I would also get term. I don’t ignore the salesman, but so far have ended up acting as if I had.

Interesting that “many families rely on the support of others (and of Medicare) to help in the case of long term disability.” I do get long term disability insurance – that money is something I wouldn’t want to ask for from others.

As a person who didn’t have LTD insurance and developed a long-term disability, I wish I would have had it–wasn’t working, however, and didn’t have the $. In the two cases I know of people who have had to use their LTD insurance (both purchased through employers), one had no problem getting the payments started, but the other one had a heck of a time. My advice is to take a close look at the policy being offered and see what disabilities are covered and what are not because not every disability is covered.

Following up on Sheila’s comment–On disability insurance, one of the the other important questions is a distinction between ability to work in “own profession” or “any profession.” Any profession is pretty broad, and might mean a significant drop in income, yet the insurer is off the hook.

Thanks for the article, I need to think over this. My spouse quit work so there is no need to replace the lost income and I need to weigh the value of paying over 50 bucks per month on the 300k 20 year term policy.

Finished thinking on this. It will only cost 3.4% of the insurance payout over the remaining 16.5 years of the term. Worth the gamble to keep the insurance in place. IMO the odds are better in a payout than playing the lottory. (Which life insurance is, one is betting that the death will result in a payout.)

Just echoing what so many others have said with a little ‘it happened to me’ — If anyone in your world counts on you in any way, life insurance is a good idea and it’ll never be cheaper to get than it is today. You never know when you’re going to suddenly become uninsurable. I am lucky that I got a policy in place before my daughter was born. Before pregnancy, I was fit, a runner, a body a decade or more younger in stats than in years. But I developed heart failure as a complication to pregnancy. It would be impossible for me to get an affordable policy now.

Check out organizations you belong to that offer discounts on Long Term disability- my husband is a member of the Knights of Columbus and they have ridiculously low prices for awesome term insurance and long term disability insurance. Well worth it for our circumstances-one grandparent on each side developed Alzheimer’s and my husband’s mother also has Alzheimer’s…it sucks, but we do know it’s hereditary and we’d rather have long term disability insurance than have the other spouse in penury and lose their home in order to keep the sick one in a non trashy memory care home.

I liked “Evaluate your payment terms”, not heard of paying annually before (I met with an insurance agent too). I have a question, say i want an insurance for 1 Millon dollars, is it wise to get it from 2-3 companines (say, $300,000 each)instead of just one? So if one company goes down i don’t have to worry too much.

Thanks for your time.

One last thing about life insurance – there are several comments here suggesting a diminished need for it…even when you’ve built up wealth – nestegg, retirement, paid off home, you do need it (when there are children & marital assets involved) until you are TRULY self-insured. End of life costs can be expensive – and which grieving widow(er) wants to sell their home to liquidate the passed-away spouse’s estate to make good on medical debts?

From an actuarial point of view, a younger person (20s or early to mid-30s) is statistically more likely to become disabled than to die before the age of 65 — so it is CRITICAL if anyone (yourself included) relies on your income to have short term and long term disability insurance. Through my work I get it for the laughably low rate of $2.50/every two weeks, and that is for 60% of my pay until I get on SS. Don’t count on getting on SS disability either: they almost automatically deny every time and it takes years to work through an appeal, and success is rare (I’m an attorney and I know what I’m talking about). And remember that for SSDI you must show that you are unfit for ALL kinds of work — so if you were a teacher or an accountant, if you can sit behind a desk and make phone calls to sell magazines, that’s good enough for SS and you won’t be disabled. If you made $100k per year but you have a brain injury and now can only pick vegetables? That’s good enough too. You’re not disabled. GET DISABILITY INSURANCE!!!

Just because I don’t have time to point out everything that I disagree with in your post I will just point out the obvious.

If you don’t trust your insurance agent to help you find the best combination of coverage and price for your situation – you need to get a new insurance agent.

I get life insurance through work up to $250,000 for free. For an additional six dollars a month I have increased it to $500,000. $72 a year is a bargain (the best I everrrrr haaaaad), and at my age (49) hard to beat.

Re: Do you have adequate resources and assets to cover funeral and burial expenses?

One thing I learned when my dad died a few years ago: The life insurance payout was very prompt; the distribution of his estate took almost two years. So I’d say that if you’re counting on your own savings to cover funeral/burial costs, make sure those savings are in a joint account or otherwise easy for your survivors to access. If not, it could take a long time for your survivors to get reimbursed for the funeral costs.

Primerica Financial Services only sells term because for 33 years they have known that doing what’s right is the way to success. I am an agant for this company and feel so confident to recommend to anyone needing life insurance to check out the value and options.