Common Myths DeBunked: Why an American Family Insurance Policy is Necessary


The general rule is that if your death won’t have a financial impact on your family, you don’t need life insurance. However, it’s a bit more complicated than that. For example, some people don’t take into consideration just what would happen if they were to pass and leave behind their families. They base the decision to get life insurance solely on the monetary factor and forget a few other things. For example, do you know who often stay-at-home-moms say they’re not insured because they don’t bring any finances into the home anyway, so why pay for something they don’t need when they’re already living on one income?

That’s fine and all, but what happens if that mother – God forbid – passes away? Now the father of her children is required to pay for childcare, an expense they didn’t consider because she stays home and provides no financial assistance. Many people simply forget small details such as the fact that this mother might not bring any money in, but she’s saving a lot of money that would otherwise be going out.

Life insurance is a difficult subject to address. There are many grey areas, and it’s a subject that simply makes people uncomfortable. No one wants to think about death. However, American Family Insurance offers life insurance to individuals with a little help understanding the myths and misconceptions about this product.

I Don’t Have a Family of My Own

It doesn’t matter. If you die, how will you be buried or cremated, and who will handle your debts and personal expenses? Most people assume that because they die, these things won’t matter, but they will. These things matter greatly. The last thing you want to do is cause your parents or siblings or other extended family members undue issues with your personal debts. If you have no personal debts, a small policy that will allow you to bequest money to your favorite charity or loved one in need of a college fund or something of that nature is always a good idea. American Family Insurance offers several smaller policies that cost very little and offer enough to handle personal debts and small gifts upon your death.

Not Everyone in My Family Needs Life Insurance

We beg to differ. Look at it like this; if someone in your family is taken from you, will their absence make a difference in your financial situation? Will their funeral costs be too much for you to bear? Will your wife or husband who stays home with the kids need a policy to cover the fact that they are no longer home to care for the kids or house? Anyone who provides anything to your family that otherwise would cost money is worth having an insurance policy for. This is sometimes the difference between financial ruin and comfort after the loss of a loved one, which is already difficult enough without the stress of financial issues looming over your head.

I Have Plenty of Time because I’m Young

Right, because young people never get into accidents or become diagnosed with a terminal illness. Listen, this is difficult to consider, and it’s not something you ever want to think about. We get it; I hate talking about life insurance and wills and death and caregivers for our kids with my husband. It’s a taxing, difficult and awful conversation to have. I cry every time I think about, and every time we talk about it. I’m tearing up right now thinking about what would happen to our kids if my husband or I passed, and how I would live without him in my world. It’s a terrible reality, but it is reality; life is short and everyone will eventually die. It’s the only guarantee in life (taxes….we’ll all be paying taxes, I guarantee that, too). Just because you’re young doesn’t mean you aren’t valuable or that you have all the time in the world to get a life insurance policy. It’s not something that can be put off until tomorrow.

Do you know how difficult it was to open up life insurance policies when we were 21 and newly married? Do you know what it was like earlier this year to increase both our life insurance policies at the age of 31 because we just added twins to the family, making us a family of 6? We are so young. We are so young, and so healthy, and yet we have to do this terrible and not very much fun activity. Just do it and never think about it again. Trust me.

We Just Need a Little Policy

Again, you are likely incorrect. You might need a policy much larger than you think. For example, you might consider a policy that will pay off your home so that your spouse and kids can live there without a mortgage, but what about your other debts? What about your kids’ college educations? A $50,000 life insurance policy might seem like a lot of money, but that’s not enough to make up for your loss and your loss of income. It’s not enough to take care of a larger family. If you’re paying for a policy, it might as well be one that’s much larger so that you can ensure that your death does not affect your family in every aspect of your life.

Add up your debts, your mortgage, the cost of living in your household and the amount of money it takes to raise a child (and multiply that by how many kids you have) and that’s where you need to start thinking about buying a policy.

Term or Whole Life?

There are many advantages and many disadvantages to both, but you can check them out with an American Family Insurance representative or online. Term is typically recommended for younger people, and it is much less expensive than whole. However, whole life policies come with a cash value, which is often helpful to many people. There are a lot of considerations to make, but your family has to figure out which policy is best for your family.

Photo by Kevin Winter/Getty Images


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