Every year, September is Life Insurance Awareness Month. With its industry-wide campaign, it aims to bridge the knowledge gap by providing all the educational resources necessary for one to know everything about insurance.
History of life insurance awareness month
It was started in 2004 as an initiative by Life Happens, a non-profit organization. The aim of LIMA is to create awareness about insurance. It helps to educate people on the significance and need for acquiring an insurance policy.
The month of September is marked by the celebrations of awareness of the importance of Life Insurance in every home (Life Insurance Awareness Month – LIAM). With the smallest monthly budget available, low-income families have to make difficult decisions to determine their financial priorities. Unfortunately, life insurance is not at the top of the list. However, in America, many families cannot survive a month without the salary of the head of the family or one of the spouses.
That’s exactly why, experts say, more than ever, it’s vital that consumers protect their financial security. Life insurance has provided this type of protection to Americans for over 200 years.
What is Life Happens?
Life Happens is a non-profit organization that was formed in 1994 by seven prominent insurance organizations. It is governed by a board of directors of 18 members, consisting of five representatives of major insurance producer organizations and eight representatives of Life Happens’ member companies.
The purpose of Life Happens is to aid people to take personal financial responsibility by purchasing life insurance and other related products. It also aims to educate the public by creating awareness regarding the importance of owning an insurance policy.
What does LIMRA stand for?
LIMRA stands for Life Insurance Marketing and Research Association. LIMRA is research, consultation, and professional development organization that works worldwide. It is committed to providing the insurance data to laymen and connects them to the data to address their insurance-related queries.
It was in 1971 that the organization changed its name to LIMRA from LIAMA (Life Insurance Agency Management Association). The name change manifested the dedication of the organization to study all distribution systems of life insurance. It now works as an international organization in 39 countries. LIMRA has also established its substantial grounds in various research and training programs.
Common Life Insurance Misconceptions
Life Insurance Is Expensive
There are many people or families who are reluctant to buy insurance for themselves or their loved ones. The main reason behind this hesitation is a common misconception that life insurance is expensive. When you don’t have adequate knowledge about insurance, it is natural for you to believe that it is costly because, on the surface, paying monthly or annual premiums can seem like an extra expense.
However, as per the ground realities, buying insurance can be as cheap as the price of a daily coffee cup. From the wide range of insurance policies available, you can get the more suitable one for your pocket. The coverage amount can be customized by choosing the premium payment as per your wallet feasibility. The key is to talk to a local financial representative and get an insurance quote. An insurance quote helps you get insurance within your budget.
I Don't Need Life Insurance.
People usually equate insurance with either illness or death, so those who are healthy without any history of family medical illness often think that they don’t need any insurance. They are of the view that their self-savings can help them gain financial sustainability. This unfounded thinking is very short-sighted. In reality, we live a very uncertain life.
Everyone needs to get insurance for themselves and their loved ones, even if they live a perfectly healthy life. This is because accidents happen, and they can happen to anyone. If you have a family or loved ones relying on you for financial assistance, you need to get insured for them. Through a wide range of different types of insurance, you can cover your personal debts, funeral, and medical bills. The coverage amount can also work as an income replacement for your family. Even if you don’t have a family relying on you, insurance can prevent you from becoming a financial burden on someone after your death.
The Life Insurance I Get Through Work Is Enough
Many life insurance companies offer an insurance policy for their employees. Workplace insurance is usually group life insurance. Many people think that this coverage is enough for them.
However, in reality, you may be paying more and getting less through work insurance. The coverage you get may not be enough to pay your bills or cover your final expenses. Moreover, the insurance stays for as long as you are working in the company. Losing a job may lead to losing your insurance.
Life Insurance is a mandatory catch. It should be purchased by everyone despite their health condition. There is still a widely spread narrative among the people that insurance is an additional expense. This is mainly because people only have surface knowledge about insurance. Therefore, Life Insurance Awareness Month is dedicated to spreading awareness about insurance among people.
Benefits of life insurance
Property Insurance / Life Coverage Remains Low:
- 30% of American households do not have any type of life insurance. Of those who do, only 44% have life insurance – purchased individually, the rest is linked to employment or entities;
- 50% of American households (58 million) say they need more life insurance;
- 4 out of 10 families, with children under 18 years old and formed by the mother figure as the only or main source of income, have life insurance. However, this coverage is equivalent to 60% of the coverage that men have.
Financial priorities that compete with life insurance:
- “daily expenses” such as energy, food, clothing and transportation costs, cited by more than half of consumers surveyed as inhibiting to investing in financial goals;
- when asked about financial issues, “money for a comfortable retirement” was the response of the majority of 67% of consumers. However, there is a reference to life insurance coverage that addresses premature death;
- funeral expenses and leaving stable status for dependents were recorded as priorities for less than 40% of consumers surveyed;
- of consumers who believe they need life insurance, 86% say they haven’t bought it because they think it must be too expensive;
- middle-income consumers are more concerned about debt reduction and more money available for retirement than other groups surveyed.