There are a lot of myths and misconceptions out there about life insurance, and you’ve probably heard most of them.
We’ve put together a quick quiz to test your knowledge and help you better understand this important financial product. Give it a shot, and see if you’ve got the straight scoop on life insurance. Let’s get started!
How Well Do You Know Life Insurance?
Question 1: What is the primary purpose of life insurance?
A. To provide a tax-free death benefit
B. To cover funeral expenses
C. To help secure your financial future
D. All of the above
Answer: D. Life insurance is a great way to cover a lot of important financial concerns — including paying off educational, mortgage and medical debt.
Question 2: Can you get life insurance if you have a dangerous hobby?
A. Yes
B. No
C. Only if you pay a higher premium
D. Only for certain hobbies
Answer: A. Yes, in many cases, you can still get life insurance if you have a dangerous hobby. You may be required to fill out a questionnaire about your hobby and pay a higher premium, depending on the level of risk involved.
Question 3: If you quit smoking, can you get re-rated to save money on life insurance?
A. Yes, but only if you quit for a medical reason
B. Yes, but only if you quit for a non-medical reason
C. No, you cannot get re-rated
D. It depends on the specific circumstances
Answer: D. It depends on the specific circumstances. If you quit smoking for a non-medical reason, you may be able to get re-rated to a more favorable rate class after demonstrating a stable lifestyle change. If you quit smoking for a medical reason, the cost savings you’d otherwise see may be affected by the health concern that led to your decision.
Question 4: What factors can affect your life insurance premium?
A. Age
B. Health
C. Lifestyle
D. All of the above
Answer: D. All of the above. Your age, health and lifestyle all play a role in determining your life insurance premium.
Question 5: Can you get re-rated if you lose a significant amount of weight?
A. Yes, if the weight loss is due to diet and exercise
B. Yes, regardless of the reason for the weight loss
C. No, weight loss does not affect your life insurance premium
D. It depends on the specific circumstances
Answer: D. It depends on the specific circumstances. If your weight loss is due to diet and exercise, you may be able to get re-rated to a more favorable rate class after demonstrating that you can maintain the weight loss. However, if the weight loss is due to a medical condition, the cost savings may be affected by the underlying health concern.
Question 6: Is life insurance affordable for the average person?
A. Life insurance is always expensive and seldom affordable for the average person.
B. The cost of life insurance varies depending on factors such as age, health and the amount of coverage needed.
C. There are no affordable life insurance options available for the average person.
D. The cost of life insurance is the same for everyone.
Answer: B. The cost of life insurance varies according to a number of factors, but can be quite affordable. For example, depending on your circumstances, you might be able to purchase a life policy from ERIE for less than $20 a month.
Question 7: I am young and healthy, so do I really need to spend money on life insurance?
A. No, young and healthy people are at lower risk of dying and do not need life insurance.
B. No, life insurance is primarily for older people or those with health issues.
C. Yes, life insurance is generally less expensive for young and healthy people.
D. No, it is not necessary to purchase life insurance until you are older or have health issues.
Answer: C. Yes, life insurance is important at any age and generally less expensive for young and healthy people. This means you can lock in the best rates for your future and purchase additional benefits that allow your coverage to increase as your needs change.
Now That You Know
Whether you’re considering a traditional whole or term life policy, or something more streamlined like ERIExpress Life, life insurance is a great way to help build a secure future for your loved ones. Understanding the factors that affect your life insurance premium and the options available to you can help you make the best decision for your unique needs. Contact us today to find out what coverage works best for you.
ERIE life insurance products and services are provided by Erie Family Life Insurance Company (home office Erie, PA), a member of Erie Insurance Group, and are not available in New York.
ERIE® insurance products and services are provided by one or more of the following insurers: Erie Insurance Exchange, Erie Insurance Company, Erie Insurance Property & Casualty Company, Flagship City Insurance Company and Erie Family Life Insurance Company (home offices: Erie, Pennsylvania) or Erie Insurance Company of New York (home office: Rochester, New York). The companies within the Erie Insurance Group are not licensed to operate in all states. Refer to the company licensure and states of operation information.
The insurance products and rates, if applicable, described in this blog are in effect as of January 2024 and may be changed at any time.
Insurance products are subject to terms, conditions and exclusions not described in this blog. The policy contains the specific details of the coverages, terms, conditions and exclusions.
The insurance products and services described in this blog are not offered in all states. ERIE life insurance and annuity products are not available in New York. ERIE Medicare supplement products are not available in the District of Columbia or New York. ERIE long term care products are not available in the District of Columbia and New York.
Eligibility will be determined at the time of application based upon applicable underwriting guidelines and rules in effect at that time.
Your ERIE agent can offer you practical guidance and answer questions you may have before you buy.
