If you only had a crystal ball, right? If you knew when you were going to die you could put off buying life insurance right up to the last moment, or if you knew you would outlive the need for life insurance you could just not buy at all.
Well, unless you are terminally ill or have some tried and true hooey wooey visionary way of knowing when the end might come, you are forced to deal with statistics and mortality assumptions. How many times have I heard, “The insurance company is betting I’m going to live and if I buy life insurance I’m betting that I’m going to die”?
Well, let’s be really up front and fair here. The life insurance company does believe you are going to live or they wouldn’t sell you the insurance. Duh!! But does that mean they don’t pay out on tens of thousands of claims every year that were the result of unexpected deaths? If you’re a male between age 25 and 64 the life insurance companies will be right most of the time, but 1 in 6 times they won’t be. That’s right. When you reach age 25, 1 in 6 of you won’t see age 65. If you’re female 1 in 9 of you won’t make it that far.
Let’s say for a minute that car insurance wasn’t mandated by law, completely voluntary. If you knew that the chances were randomly 1 in 6 that you would total your car I’m thinking most of you would carry comp and collision anyway.
Let’s look at it another way. That TV show about 6 degrees of separation is probably overkill in this discussion. I suspect that very few adults can say that they didn’t personally know someone between 25 and 64 who died. Most of us know someone who died prematurely and didn’t have life insurance. We just had a woman in her 40’s die in a car accident last week and a man in his 50’s have a heart attack two days ago in our small town of 6000 people. The man is still alive, but is in critical condition and without a transplant isn’t expected to make it.
A young man in his 20’s who is an ongoing subject of prayer in a men’s group I attend has inoperable cancer. It really goes on and on and I don’t make these points to get people to buy something that is going to break the bank, or even their budget. I make these points so maybe someone will understand (that doesn’t already) that we have a good chance of living to old age, but we aren’t immortal. There is prudent reason to consider having life insurance. For all of those who I have delivered death benefit checks to, saying there is prudent reason would be considered an understatement.
Bottom line. Just food for thought. If there is someone in your life who is depending on you, make sure they really can depend on you.