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Life Insurance

10 Life Insurance Myths Debunked

By Jake Bronstein Feb 6, 2017

After interviewing hundreds of parents about why they do or don’t buy life insurance, some familiar arguments started taking shape among those choosing to go without.

The good news is: You’re not alone if you believe these myths. The better news is: It’s never too late to purchase coverage.

1. “I Can’t Afford It Right Now”

Sure, you have a lot of dueling financial priorities. But term life insurance coverage at Fabric starts at just $11 per month (for $100,000 in coverage).* And you can apply in just five minutes.

2. “I’m Not Going to Die Anytime Soon”

Unless you have a crystal ball, there's no way to know what might befall you, or when. So find out: Do you really need life insurance?

3. “I Get It Through My Work”

People who say this may not realize how little coverage their work actually provides. If your work offers life insurance at all, coverage usually doesn’t exceed $50,000 and it expires when you leave your job. If you intend to buy coverage when it expires, that’ll put you back at square one, which can be costly (see #4).

4. “I’ll Buy Life Insurance Tomorrow”

Be careful with that. Life insurance premiums increase as you age. Let’s say you wait five years before applying. Depending on how old you are when you first made that choice, you could wind up paying significantly more, if your health hasn’t declined.

5. “My Parents Will Take Care of My Family If Something Happens to Me”

They raised you after all. But that was a long time ago. Even if they’re up to the physical challenge, odds are they haven't included this in their own financial plan.

6. “All That Money Is Wasted If I Don’t Die”

Term life insurance isn’t meant to be an investment, it’s about mitigating the most critical risk to your family. Think of it like this: Is homeowners insurance a waste if your house never burns down? Of course not. Knowing there’s a plan in place to take care of the huge costs that would come with an unexpected calamity can help put your mind at ease and give you a sense of confidence.

7. “I Can Get a Better Return Investing the Money”

The purpose of life insurance is to offer financial protection to help take care of your family’s immediate and future needs in the event that you unexpectedly pass away. Once your policy is in force, you’re covered for the full coverage amount.

8. “I Just Don’t Have the Time Right Now”

Signing up for some types of life insurance policies takes way more time than you’d expect, often weeks from the time of the first quote until the policy is actually signed and goes into effect. But technology is changing that fast. With Fabric, you can apply for term life insurance in just five minutes.

9. “I Don’t Have an Income That Needs Replacing”

Ah, the swan song of the stay-at-home parent. You figure you’re not a bread-winner, so no bread needs replacing if you’re taken out of the equation. But your partner needs to keep working to keep the family afloat. If you die unexpectedly, all of the chores you used to do (everything from watching the kids to running errands) now falls on them.

They’ll likely need help, and that help costs money. It's true: stay-at-home parents have their own unique life insurance considerations.

10. “I Don’t Trust Life Insurance Companies; They Don’t Pay”

Check whether the insurer you're considering is highly rated, based on its A.M. Best rating. Top ratings indicate an insurer's financial strength and ability to meet its ongoing insurance policy and contract obligations. Fabric’s policies are issued by Vantis Life Insurance, rated A+ (“Superior”) by A.M. Best.

Plus, life insurance is regulated by authorities like the NAIC and states' departments of insurance.

*Sample rate is for a 25-year-old female in excellent health. Get a quote to see personal pricing.

Fabric exists to help young families master their money. Our articles abide by strict editorial standards.

This material is designed to provide general information on the subjects covered. It is not, however, intended to provide specific financial advice or to serve as the basis for any decisions. Fabric Insurance Agency, LLC offers a mobile experience for people on-the-go who want an easy and fast way to purchase life insurance.


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Written by

Jake Bronstein

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Accidental Death Insurance policies (Form VL-ADH1 with state variations where applicable) and Term Life Insurance policies (Form ICC16-VLT, ICC19-VLT2, and CMP 0501 with state variations where applicable) are issued by Vantis Life Insurance Company (Vantis Life), Windsor, CT (all states except NY), and by The Penn Insurance and Annuity Company of New York (NY only). Coverage may not be available in all states. Issuance of coverage for Term Life Insurance is subject to underwriting review and approval. Please see a copy of the policy for the full terms, conditions and exclusions. Policy obligations are the sole responsibility of Vantis Life.

All sample pricing is based on a 25-year old F in Excellent health for the coverage amount shown. All samples are for a 10-year term policy, unless otherwise stated. Term Life Insurance policies (Form ICC16-VLT, ICC19-VLT2, and CMP 0501 with state variations where applicable) are issued by Vantis Life Insurance Company (Vantis Life), Windsor, CT. Coverage may not be available in all states. Issuance of coverage for Term Life Insurance is subject to underwriting review and approval. Please see a copy of the policy for the full terms, conditions and exclusions. Policy obligations are the sole responsibility of Vantis Life.

Fabric Insurance Agency, LLC (FIA) is an insurance agency licensed to sell life and accident insurance products. FIA will receive compensation from Vantis Life for such sales. The NAIC Company Code for Vantis Life is 68632. See the Terms of Use for additional information regarding FIA.

A.M. Best uses letter grades ranging from A++, the highest, to F, companies in liquidation. Vantis Life’s A+ (Superior) rating, which was reaffirmed in April 2020, ranks the second highest out of 16 rankings. An insurer’s financial strength rating represents an opinion by the issuing agency regarding the ability of an insurance company to meet its financial obligations to its policyholders and contract holders and not a statement of fact or recommendation to purchase, sell or hold any security, policy or contract. These ratings do not imply approval of our products and do not reflect any indication of their performance. For more information about a particular rating or rating agency, please visit the website of the relevant agency.

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