Don’t wait: Life Insurance can protect your financial future

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LIMRA research shows that 4 in 10 consumers – nearly 100 million adults – know they need, or need more, life insurance coverage.For many, the biggest obstacle is simply not having enough information.

Just a quarter of consumers believe they are very knowledgeable about life insurance. Most say they put off coverage because they believe it’s too expensive, don’t know what to buy, or how much life insurance they need. Here are the most common misconceptions we hear about life insurance:

Life insurance is too expensive

Many consumers, especially younger ones, vastly overestimate the cost of life insurance. In 2025, LIMRA found that over half of Americans overestimated the cost by as much as three times. Younger adults, who are the most likely to say they need life insurance, overestimate the cost by about 10 to 12 times the actual amount. 

The median cost of a $250,000, 20-year term life insurance policy for a healthy 30-year-old is less than $300 a year, or less than $1 a day.

Workplace life insurance is sufficient

Many people believe the basic life insurance provided by their employer is enough. Of the adults who only have life insurance through their employer, over half — 57% — believe that the amount they obtain through work provides them with enough coverage. 

However, the median basic coverage offered at the workplace is either a flat sum of $20,000 or just one year’s salary —  far less than the 10 to 15 times your income that experts recommend. 

Almost half of households — 49% — that only have workplace life insurance coverage say their families would struggle financially in less than six months should a wage earner die unexpectedly. 

You don’t need life insurance until you are older

Younger, healthy consumers often put off buying life insurance, thinking they don’t need it yet. In reality, premiums are significantly lower for younger individuals, and because coverage lasts for decades, buying early on means locking in more affordable rates.

Waiting could mean paying more later omissing out on affordable coverage if a health issue comes up.

The purchase process is too difficult

Nearly half of Americans, particularly younger adults, say they delay buying insurance because they are intimidated by the process. Consumers do not understand the underwriting process nor the different types of life insurance products available. This lack of knowledge could be preventing healthy, young consumers from obtaining the coverage they need to protect their families.

You only need coverage if you have dependents

Life insurance is often thought of as solely for those with children or a spouse. However, it can also pay off a mortgage, cover monthly bills or provide for funeral expenses. 

Even if you don’t have dependents, life insurance can ease the financial burden on parents, siblings, or other loved ones who might otherwise have to handle these costs. It can also help protect co-signers on loans, leave a charitable gift, or provide peace of mind that your final expenses won’t fall on family members.

Life insurance is only for final expenses

LIMRA research shows a quarter of Americans believe life insurance is only for paying for burial costs. While it can be used for that, it can also do so much more — such as help provide income replacement, supplement retirement income, pay off debt, and ensure long-term financial security for loved ones.

September is Life Insurance Awareness Month, a national campaign to help families understand the importance of coverage and how it protects long-term financial security. As the month comes to a close, it’s a great time to take action rather than putting it off.

Here are a few steps to consider:

• Calculate your coverage needs. Use a trusted life insurance calculator or talk with a financial professional to figure out how much protection makes sense for your situation.
• Review what you already have. Check workplace benefits and any existing policies to see if they’re enough — most employer-provided coverage falls short of expert recommendations.
• Compare options. Research different policy types (like term, whole, or final expense) and shop quotes from multiple insurers to find affordable coverage that fits your needs.
• Talk to your family. Make sure your loved ones know about your policy and how it helps protect them.
  

Taking even one of these steps now can put you in a stronger position than waiting until later. The goal of Life Insurance Awareness Month isn’t just education — it’s helping you move toward real financial protection.

Karen Terry

 

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Karen Terry leads the Individual Product Research team, developing and implementing LIMRA's research program for individual life, disability, long-term care and critical illness insurance products in the U.S. and Canada.