I started Insurance Blog by Chris™ because I have a passion for insurance. Here at the blog, our job is to educate and inform people about the best insurance for them. Since then, we have grown into national brands with a large team of researchers helping people understand all forms of insurance.

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Written by Chris Huntley
Founder of Huntley Wealth & Insurance Services Chris Huntley

Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insu...

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Reviewed by Rachael Brennan
Licensed Insurance Agent Rachael Brennan

UPDATED: Apr 18, 2022

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I don’t have to work too hard to paint you a picture of the Great Life Insurance Scam!

You know exactly what I mean – the predatory life insurance salesperson who shows up at your house with only ONE goal.

To sell you as much life insurance as you’ll take. Of course, all of this is to prop up his or her commissions.

Yep, sadly, that’s the impression far too many people are left with when it comes to the insurance industry…

…BUT is there any truth to this mythological portrayal?

NOPE, and let me give you 9 GREAT reasons to debunk the Great Insurance Scam.

If you’re looking for personalized, honest service you needn’t look further.

We can help you find the best bang for your buck when it comes to affordable and comprehensive life insurance coverage.

Get REAL People – Death Happens – That’s No Scam

So let’s get back to business.

Having a loved one die can be one of the most traumatizing events in a person’s life. The emotional impact alone is enough to drive people into depression.

…but the financial effects slam families without warning. When the primary breadwinner passes away, it’s like a nuclear bomb being detonated in the middle of your life.

If you think that’s tough for adults, try being a kid. Virtually everything is turned upside down in the blink of an eye.

According to the Journal of Hospice & Palliative Nursing:

“One out of every 20 children aged fifteen and younger will suffer the loss of one or both parents. These statistics don’t account for the number of children who lose a “parental figure,” such as a grandparent or other relative that provides care.”


These numbers even surprised me.

Sure, your family will inevitably move on after you die –  but remember – your debts and obligations won’t just evaporate. The beneficiaries of your estate have to deal with them.

Face it, without Life Insurance, your family might not be able to maintain the quality of life they’ve become accustomed to. The worst-case scenario is almost unfathomable. They may lose everything – have to sell the house and car to start over whether they want to or not.

…and this entire picture of their future rests on your decision to buy Life Insurance…or not.

Despite these facts, a study from 2017 shows that 41% of Americans don’t have life insurance!


This is a scary statistic!

I hope you’re thinking to yourself right now…

“Don’t people realize the importance of Life Insurance?”

Sadly it appears not – so I am going to rectify this situation.

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9 Reasons Why Life Insurance Is NOT A Scam

life insurance agent talking with young couple

Strap on your seat belts and get ready. Here we go.

1) Accidents happen unexpectedly, which means the being prepared is essential…

No one likes to talk about death; whether that’s the loss of your own life or someone close to you.

Because of this, planning for life insurance can sometimes be a tough topic to discuss. Most of us like to think of ourselves as immortal, but unfortunately, accidents do happen, so being prepared is essential.

Death by an unexpected illness, accidents or natural causes can happen at any time.

Although cash will never replace that loss, it can ease the financial burden.

The payout from a Life Insurance death benefit will ensure the financial security of your loved ones no matter what happens to you.

2) Funerals are expensive.

In a nutshell, funerals mean you’ll be shelling out some big bucks and this responsibility will be passed on to your next of kin. The cost of a basic funeral which includes burial, a coffin & a simple service can easily surpass $10,000.

…and if you’re looking for more bells and whistles it can get far more expensive, very quickly.

Without Life Insurance, that bill will be footed by your next of kin.

Who wants that during an already overwhelmingly difficult time? This financial burden will cause unnecessary amounts of stress and could be easily avoided if you purchase life insurance.

3) Debt stinks and it will be passed on to those you love.

Debt can be an awful burden on anyone, causing long-lasting stress & financial struggle. By investing in a Life Insurance policy, you can avoid leaving debts for your next of kin and loved ones.

The death benefit will assist those around you with financial liability in case of your early demise.

Wouldn’t it feel great to go to bed knowing you’re doing everything in your power to ensure a safe and financially secure future for your family?

4) To ensure the financial security of your business.

A common misconception about life insurance is that it only covers individuals. But this is NOT the case! If a business owner or partner loses their life, great Life Insurance planning can protect the business from financial instability or keyman loss that might lead to bankruptcy if left unaddressed.

Life Insurance can play an extremely important role when it comes to the success of your business when you’re gone.

5) Protect your children’s future.

Every parent wants their children to have a safe and secure future. The loss of a parent’s life can impact whether a child can afford to go to college, whether they can go to a good school, or whether the family can survive the loss of a major player in their lives.

Life Insurance doesn’t place a monetary value on your life but rather eases the lives of your loved ones so they have a secure and financially stable future after you’re gone.

6) Supplement your retirement.

Having the correct type of life insurance and the appropriate amount of life insurance coverage in retirement will accomplish multiple jobs. It can help protect your income, provide tax-free cash flow, help manage taxes, provide peace of mind to families, and even improve the total returns in a portfolio. Why Life Insurance Is Essential For Retirement Planning, Forbes.com

Yep – life insurance can be a great way to supplement your retirement years. Even if your parental obligations are discharged – you may still have a spouse or partner that relies on your pension or social security. What better way to protect their quality of life, than by taking out a policy that will cover that loss should you die unexpectedly.

If you have a bit more money in your estate you can also get creative with life insurance planning. That’s why it’s so very important to speak to a KNOWLEDGABLE independent agent that can walk you through some terrific strategies.

Life insurance used as a tool for retirement can offer tax-deferred growth, tax-free cash flow, and a tax-free death benefit.

There really are a TON of ways to use life insurance for retirement – so I’m going to save that information for another post.

7) Peace of mind.

Life Insurance benefits will never make up for the loss of a loved one.

Nope, I can’t make that claim.

But I will say, however, that it provides a level of protection and peace of mind that at the very least, your family’s financial situation will be secure.

Your spouse will have enough money to live on, your children can go to college and the business you’ve worked so hard to build will continue to move forward.

Now that’s something.

8) Unexpected illness, chronic illness, and long-term care.

Unexpected illness can happen to anyone.

If you think ahead, you can even choose a policy that gives you some cash when the going gets tough.

Ask your independent life insurance agent about Chronic and Long-Term Illness riders. This can save you a LOT of hassle in the long run.

9) It can be a financial investment if you’ve exhausted your other options.

Of course, I wouldn’t typically call life insurance an investment. There are better things that you can do with your money if you’re looking to make a profit.

That being said, you can strategically use a permanent life insurance policy as a vehicle for investment. You can borrow against the cash value of your policy to purchase a home (or some other expenditure) without having to pay taxes or penalties.

This is another reason to speak to us. We have some great strategies to discuss with you.

I’ll leave you with a few parting words.

For MOST people – I would recommend you buy term and invest the money you would have spent on costly permanent solutions. Typically this works out best for the majority of people.

The Verdict = The Great Life Insurance Scam DOESN’T Exist

The Great Life Insurance Scam is simply a myth.

I’m not sure where it started but I feel VERY comfortable debunking this falsehood.

Quite simply put, Life Insurance is one of the most valuable investments in your future that you’ll ever make.

There are few things in life that deliver financial security to your family and peace of mind.

**Of course, there are always going to be a few bad apples in any bunch, and Life Insurance sales is no exception.  However, on the whole, life insurance agents are simply looking to help consumers protect their loved ones with financial security in case of their untimely death.  And, if you stick with a simple term or guaranteed universal life policy, you should be just fine!

If you aren’t insured and have debt, a mortgage, dependents, business obligations or all of the above, you need to speak with our agents today.

Final Thoughts

We’ve seen it all.

The clients who didn’t pull the trigger that should have. The ones that did and passed away knowing their families would be secure.

…and I’ve got to tell ‘ya there’s nothing quite like delivering that check – it’s bittersweet but satisfying, knowing that their families will be ok.

For me, the TRUE superheroes in life plan for the financial future of their families.

Why not bulletproof your loved ones well-being and get covered TODAY.