Top 3 Reasons People Don’t Buy Life Insurance

Scott McEachern |

We’re living longer – that’s a fact. As our life expectancy increases, many individuals have moved their planning focus from dying too soon to living too long. Fewer Canadians are buying life insurance; approximately only 43% of Canadians had a policy in 2013, according to LIMRA.

The problem is that despite lower ownership, there is still a need for life insurance, regardless of what life stage you are in. Further survey results showed that 33% of Canadians would face immediate financial struggle if they lost one family member’s income due to a premature death. Another 32% of households could only last a month or two if the breadwinner were to pass away. So what’s the hold up? These are the most popular reasons we’ve seen in our practice.


Top 3 Reasons People Don’t Buy Life Insurance

1.    They think it is unaffordable.

Life insurance doesn’t have to be expensive. If budget is a concern, consider looking at term insurance, which is great for covering all the needs of a young family. As you age and have less debts and acquire more assets, you can look at permanent insurance to cover final expenses, tax liabilities and to leave a legacy to the next generation.

2.    Other competing financial priorities

When we meet with clients, the first topic we discuss is insurance. Why? Simply put, all the other planning immediately comes crashing down if there’s a premature death and a family loses one of the parents income. Once again, adequate coverage does not have to be expensive, but it does need to be a priority for you and your family.

3.    Lack of knowledge

Insurance can be a very confusing topic. There are different types, with different benefits, different features, and different tax implications. If you’re not interested in becoming adept with insurance products (which you really should be) then you need to find an advisor you can trust. Consider looking for someone with a designation, or are part of an industry association, where one of the commitments of members is to put the clients best interest first.