Most Americans recognize the importance of life insurance: About 70% of Americans say that they need coverage, and the number of people who intend to buy a policy has reached all-time highs during the pandemic.
But even though plenty of people understand the value of life insurance, there’s still a big gap between how many need coverage and how many actually have it. That’s why Life Insurance Awareness Month exists. Occurring in the month of September, Life Insurance Awareness Month is designed to educate people about life insurance and help them make the right coverage choices.
Want to get a head start on your own education? Here are a few things to know about Life Insurance Awareness Month and your coverage options.
1. Life Insurance Awareness Month is nearly 20 years old, but life insurance goes back much further than that.
Created in 2004 by industry education group Life Happens, Life Insurance Awareness Month is an annual campaign designed to educate Americans about the importance of life insurance and how it can help provide financial security for their families. Featuring spokesperson Brooke Shields sharing her views on why life insurance is an essential part of financial health, the campaign reached 500 million people in 2019.
While Life Insurance Awareness Month has been running for more than 15 years, life insurance itself has been around much, much longer. In fact, the first life insurance company as a way to support women in the church whose husbands had died.
More than 260 years later, the industry continues to evolve to keep up with the needs of modern families. It’s now possible to price, shop, and even buy life insurance coverage online. And for people who have put off buying life insurance because of the medical exam, the number of no exam options available continues to grow.
2. The pandemic has prompted more people to think about life insurance coverage.
If you’re thinking more about your family’s financial security during the pandemic, you’re in good company. According to Life Happens’ “Tough Talks During COVID-19” survey, about 67% of Americans say that the pandemic has led them to reevaluate their finances. Life insurance coverage is among the top five topics dominating dinner table discussions, with 30% of families now discussing this sensitive topic.
The survey also reports that the pandemic has helped two-thirds of Americans better understand life insurance’s value, with another quarter buying coverage for the first time. Additionally, half (49%) of respondents agreed that it’s essential to have open conversations with their partners and families about their financial future.
3. Anytime is a good time to get covered.
Life Insurance Awareness Month happens in September, but the right time to buy life insurance is now, according to the Life Happens’ 2020 campaign.
Just like home or car insurance, life insurance requires planning in advance—once you need it, it’s too late. Even before the pandemic began, one in three families reported they would have financial issues within a month if the primary wage earner died. Yet nearly half (46%) of people are uninsured, and even among those with life insurance, many say they don’t have enough coverage.
Life insurance can’t wait, and there’s no time like the present to buy.
4. Calculating your life insurance needs is a good place to start.
Life insurance comes with no strings attached, so your family can use it to cover day-to-day expenses, pay off debts, save for college, and more. If you’re thinking about getting covered, deciding how much you need is a good first step.
Every family’s needs are different, so think about how much yours would need to stay financially secure if you died. A few questions to consider:
- How much debt do I have?
- How much do I have in savings?
- Who do I want to protect?
- How long would they need financial support?
You can also estimate how much life insurance coverage you need with this simple calculator.
5. If you’re already covered, take the time to do an annual checkup.
About 43% of policyholders say that they either don’t have enough life insurance coverage or don’t know. As your life changes, you should make sure that your life insurance policy changes with it if needed.
Check your beneficiaries regularly to make sure the right people are set to receive the payout. For example, if you get divorced and remarried, forgetting to update your plan can mean your ex-spouse ends up receiving the policy. If you have term life insurance, make sure to keep track of when your coverage ends to avoid any gaps. And if you experienced any major life changes since you bought your policy, like getting married, changing jobs, buying a house, or having children, you might consider making changes to your policy.
Finally, make sure that your loved ones know where to find your life insurance policy and what they need to do to collect their death benefit.
Life Insurance Awareness Month happens once a year, but the need for financial security never stops. Getting the facts about life insurance can help you rest easier knowing that your family is protected when they need it most.