October 2, 2023
life insurance awareness month and financial advisors

A Guide to Life Insurance Conversations

While Life Insurance Awareness Month (September), may be ending, that doesn’t mean this sometimes misunderstood financial planning resource is any less important. In fact, this multifaceted financial tool can offer security, peace of mind, and a legacy for your clients and their loved ones, not just a death benefit. And since clients rely on financial advisors to provide well-rounded guidance, it’s important to debunk common life insurance misconceptions and help your clients understand its value. Here are some key strategies:

Challenging Common Misconceptions

According to the 2021 Insurance Barometer Study, 36% of consumers say they plan to purchase life insurance within the next 12 months, Yet there are 102 million uninsured and underinsured Americans who believe they need to buy life insurance or increase their coverage. 1

So, what’s preventing people from purchasing life insurance? Let’s dive into the most common objections and discuss how financial professionals can combat these concerns.

1. Life Insurance is Expensive

“If life insurance were free, we’d all have it,” said author and financial advisor Walter C. Young III, MBA, RICP®, in an episode of the Rainmaker Multiplier On-Demand podcast. Many clients acknowledge the need or desire for life insurance but assume it is too costly. That’s why it’s essential to educate clients on the true cost, which for many, can be quite affordable.

For example, as of September 2023, a 10-year, $250,000 term life insurance policy for a healthy 40-year-old man averages to just $23 per month.2 That’s significantly less than most monthly phone bills today or even a week’s worth of food delivery. The nationwide average phone bill for one person is around $166/month4 and the average American spends $37.28 on food delivery every week.5 Putting this cost into perspective for clients may help convey its affordability. With that being said, every financial situation is different. You should never make assumptions and it’s recommended you explore different policy options to find the right one for your client’s budget and needs.

2. “I Don’t Need Life Insurance”

Some clients think life insurance is unnecessary, especially if they’re young and healthy. In the same episode of the Rainmaker Multiplier On-Demand podcast, Sam Doerr, Vice President of Life Insurance Sales at C2P, spoke to this misconception. She clarifies why she values living benefits for the peace of mind they provide just as much as the death benefit. “I’m not necessarily so worried that I’m going to die really young. I’m more worried about, ‘I’m going to live so long, and something will happen along the way and I’m not going to be able to afford it,’” Doerr said. “Along with taxes, of course, planning for children’s futures, college planning, all of those are huge reasons for me [to purchase sufficient coverage].”

That’s why advisors should emphasize to clients that life insurance isn’t just for the elderly or the sick — it’s a crucial financial tool for anyone with dependents or financial obligations.

3. Life Insurance = Death Benefits

Life insurance is most known for paying out death benefits after a loved one passes but that’s not its only function. In fact, its function changes throughout life. When you’re young, life insurance is about protecting your assets and income. As you age, it becomes less about protecting your income and more about planning your retirement. It helps safeguard a spouse by allowing them to choose the highest withdrawal rate, like a pension maximization plan.

In the podcast episode, Young went on to explain how life insurance can bolster retirement income and the impact: “Life insurance frees us from having to have that teeter-totter talk with ourselves as to every dollar that I want to use is a dollar that I don’t get to leave to my children. And so, the death benefit really allows us to be free from that conflict and say, ‘I can spend every last dollar that I have knowing that I will still leave a legacy that I planned in the end.’”

Life insurance for families
How Financial Advisors Can Help Their Clients

1. Start the Conversation

First, attempt to overcome any objections, the most common ones already outlined above, to engage your client and clarify where they stand regarding life insurance. Then, explain the fundamentals of life insurance and the types of coverage they can take advantage of if they don’t have a solid understanding. If they do have a decent base knowledge to build on, determine your clients’ needs, and recommend insurance products that meet them.

2. Educate Every Step of the Way

Many clients underestimate the value of life insurance’s ability to supplement lost income of the loved one who has passed, which can help surviving family members maintain their lifestyle. It is also critical to explain life insurance truthfully. As an advisor, you should tell clients that while it won’t guarantee their spouse doesn’t need to work if they die first, it does provide monetary help the spouse would have received while the client was living. This allows their spouse to continue living in the same manner they’re accustomed to, and includes income they may have factored into their retirement plans.

3. Assess Individual Client Needs

A good rule of thumb is to fact-find first and recommend products that fit later. Start by understanding your client’s unique financial situation, goals, and obligations. Then, conduct a thorough needs analysis to determine the appropriate amount and type of coverage. Many states offer an online calculator to figure out the precise amount of income and debt coverage required. An important point Doerr emphasized in the same podcast is that that it’s better to have too much insurance than not enough, and she encourages clients to overestimate their coverage needs.

4. Review and Adjust Over Time

Life insurance needs can vary over time due to factors like marriage, children, or changes in financial circumstances. Another popular complaint about life insurance is that it doesn’t pay out as expected, a common cause of this is a lapse in coverage. Your client’s policies need to be up to date and accurate to truly benefit them and prevent any disruption in coverage when they may need it most. It’s best to regularly review and adjust policies as needed to ensure they are still in your client’s best interest and represent their current situation.

5. Help Clients Follow Through

According to Annuity.org, 33% of women report needing life insurance but don’t own a policy, and 29% of men report needing life insurance but don’t own a policy.3 Doerr agrees that a significant portion of the population that plans to buy life insurance probably won’t. She also finds lack of motivation and understanding to be partially responsible for an absence of coverage. “I think that it’s our job to guide them through that. They may plan to, and they should. So, I think that that’s probably just inactivity, really.”

The True Value of Life Insurance

Life insurance is more than just an expense: with the right strategy, it can be an asset. As a financial advisor, you can demystify life insurance and help your clients understand its true value. At C2P, our life insurance professionals are dedicated to guiding our advisors to better serve their clients. We help customize solutions through our IMO, so clients can make informed decisions that benefit their families and beneficiaries in the long run. To learn more about how C2P can help you as a financial advisor, schedule a 20-minute call today.

Financial Professional Use Only

The information provided in this presentation is not intended as investment advice or legal advice. The information provided is for informational and training purposes only. The information in this presentation was accurate as of the time the material was created. Tax laws and rulings can frequently change. Please discuss the client’s current situation with an accountant or tax advisor.


1. https://www.limra.com/en/newsroom/news-releases/2021/2021-insurance-barometer-study-reveals-common-misconceptions-that-prevent-americans-from-getting-life-insurance-they-know-they-need/

2. https://www.moneygeek.com/insurance/life/rates/#:~:text=Expert%20Advice-,The%20average%20cost%20of%20life%20insurance%20is%20%2423%20per%20month,monthly%20premium%20increase%20to%20%2445.

3. https://www.annuity.org/life-insurance/statistics/#:~:text=33%25%20of%20women%20report%20needing,compared%20to%2042%25%20of%20men.

4. https://www.self.inc/blog/how-much-is-phone-bill-for-one-person

5. https://www.nasdaq.com/articles/the-average-american-spends-this-much-per-week-on-food-delivery