Insurance Tips for Tough Economic Times

Roughly 56 percent of Americans say the economic downturn has made it more important to have life insurance, compared to just nine percent who believe the need has diminished, according to a survey released by the nonprofit Life and Health Insurance Foundation for Education (LIFE Foundation).

Is history repeating itself?

Historically, life insurance sales receive a boost when consumers feel financially vulnerable because of downturns in the economy and stock market. But many experts believe that the recession might be the one to buck the historical trend because of its severity. With family budgets significantly strained, experts believe that many would drop coverage and sales of new policies might plummet, though it is too early to know for certain what the ultimate impact will be, the LIFE survey suggests that the dire predictions will not come to pass.

“The American people are smart and understand the importance of protecting their loved ones with life insurance, especially in these uncertain financial times,” said Marvin H. Feldman, CLU, ChFC, RFC, president and CEO of LIFE. “Americans realize that life insurance can be the safety net that catches their family when tragedy strikes, and we’re pleased to see that so many appear to be holding onto their coverage, even as they’re scaling back other parts of the family budget to make ends meet.”

Insurance tips for tough times

If you are one of the millions of Americans who knows that life insurance is important to protect your family but you have not updated your coverage recently, the nonprofit LIFE Foundation offers three tips to help you get your insurance house in order:

1. Some coverage is better than none at all. If your budget is tight, keep in mind that there are affordable options in the marketplace. For instance, a healthy 35-year-old can buy a 10-year, 250,000 dollar term policy for as little as 180 dollars a year, or less than 50 cents a day. A smaller coverage amount can lower your premium payments as would a shorter coverage period on a term insurance policy. If your financial circumstances change, hopefully you will have the ability to add to your coverage at a later date.

2. Educate yourself. There a number of helpful resources on the Internet, including the LIFE Foundation website at The site provides general information about life insurance in addition to an online calculator that can provide you with a general sense of how much life insurance you may need.

3. Talk to an expert. Online resources are helpful, but they are no substitute for the advice you can get from an insurance professional in your community. An insurance agent can conduct a thorough review of your financial goals and circumstances, and help you determine how much and what kind of life insurance might be right for you. If you do not have an agent, seek recommendations from friends, family members or a trusted adviser such as your lawyer or accountant. You can also find an insurance professional in your area by visiting LIFE’s online agent locator.

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