You are not legally required to have life insurance, if you choose not to – that is entirely up to you. Most people take out life insurance to guarantee that in the event of their death their beneficiaries are not burdened with the costs associated with a death.
See above. Just because you owe no credit, and have no direct beneficiaries doesn’t mean you shouldn’t get life insurance. Think about who is going to pay for your funeral, and other costs that will be associated with your death. A small policy will cover these.
This is a popular myth, cited by many companies when discussing a suitable policy. The amount of insurance you require has nothing to do with your salary, it has to do with how much would be required to pay off your debts (bank loans, mortgages, income replacment etc) in the event of your death. The choice to make sure that your family is left with a comfortable amount to live on after your passing is up to you.
This depends on your needs – If you want the policy to be a guarantee for a loan or mortgage then Term may be right for you. However if you require that the policy be part of an investment portfolio or estate plan then Term Policies are not for you.
A lot of people think this – they leave college, get a job, buy a house and sign up for a Life Insurance policy. Then never think about it again. This is a mistake, things in your life change – marriage, having children etc…
Wrong – Becoming a non smoker puts you in a lower risk category than you were in when you first started the policy. This means your life insurance company needs to know about it and they will decrease your premium if your health is still the same.
Technically correct if your wife has no credit outstanding at the time of her death. However if you think about the costs of providing the same services for your family after your wife has died you may decide insurance is wise. (eg. If you are a working father – you may need to employ a nanny, or pay for a child care service while you are at work)
Just because you are over 65 doesn’t mean you cannot get Life Insurance – you can. You may have to shop around a little to get a good price, but policies for the elderly or retired are very common and easy to come by.
The ability to “cash-in”, or surrender your policy is wholly dependent on what type of policy you have. An investment variety of policy will not only pay out in the event of your death, but can also be surrendered at any time whereby the insurance company will pay you a set percentage of the overall accumulated investment value of the policy. Things like “Term” life insurance policies do not allow for this and are just means to secure a risk for a set time period.
life insurance policies will pay out for suicide as long as the policy has been in force for two years or more.
There are a lot more myths about insurance – if you are in doubt contact your broker who will put your mind at ease about what is fact and which fiction.