Dispelling these myths can help your customers protect the ones they love (BRANDON QUESTER AP)

There have been a plethora of reports and statistics over the last few years about the life insurance coverage gap in this country. These findings almost always reiterate what an opportunity the gap creates for people in life insurance sales without offering many precise hypotheses as to why it exists in the first place.

Efinancial, a national life insurance brokerage recently released a report, Seven Myths about Life Insurance. The report strives to identify and therefore dispel common misconceptions the public has about life insurance, allowing for sales professionals to allay fears and eliminate fallacies.

The first myth Efinancial identified was that life insurance is too expensive. This has been an easy and overused scapegoat for the industry to employ when confronted with dismal sales numbers. It has utilized it more and more since the financial crisis but now that the country and families for the most part are slowly getting back on their feet financially, it would behoove life insurance professional to dismiss rather than embrace this myth and explain to potential customers the sheer practicality of owning a policy. It should be explained that the cost and uncertainty that accompany not owning a policy is greater than the premiums they will be paying each month. Budgets in this country remain stretched rather thin; finding low-priced options that still provide financial stability should help sales professional overcome this hurdle.

The second myth identified is that single people and those without children do not need life insurance. It has always been a challenge to sell to single people and couples without children because for the most part they are young and the hubris and invincibility that accompany youth are a tough foe for the hypothetical tragedies that would leave loved ones saddled with debt. Sales professionals should understand the mindset of this demographic and explain the current costs of a funeral and the fact that credit card, student loan and car payments would be transferred to loved ones in the case of such an event.

The third myth or mindset rather, is that the sole provider for a family is the only one that needs to be covered. Many people believe that a stay-at-home parent is not bringing much, if any, income into the household and the loss of that parent would have a marginal effect on the finances of the family. What most people fail to grasp is the cost associated with running a household. Dave Ramsey, an expert in family finances estimates that it takes $35,000-$40,000 per year to replace a stay-at-home parent’s workload were they to die. Professional should have an easier time selling a life insurance policy that covers daily expenses for a family once this fallacy is dismissed.

The fourth myth identified is that the term life provided by most employers is sufficient. Life sales professionals should explain to customers that the term life provided by ones employer is rarely enough to take care of a family’s finances were the main provider to pass away. Showcasing policy shortcomings with the employer-sponsored account should pave the way for the explanation of supplemental coverage.

The fifth myth is that applying for life insurance is a protracted and invasive process that requires a medical examination in order to even be considered for a policy. It should be explained that the medical examiner can work around the potential customers schedule and that no-exam life insurance policies are available if one is willing to answer a series of questions based on their health and lifestyle. Remind them that premiums for no-exam policies are higher but if their main priority is to speed up the application process, no-exam policies may be a good fit.

Many people believe that once their children are grown, the financial cord has been cut and they are out of the house that they have no need for life insurance. This is also untrue. Salespeople should explain the financial impact ones death could have on a family even if children are grown. Although mortgage payments and bills may have shrunk other expenses such as increased medical attention and funeral arrangements can still saddle loved ones with a financial burden.

The final myth identified by Efinancial is the worry that if you have a negative health history or a bad habit, an affordable life insurance policy is out of reach. It should be explained to potential customers that different companies offer different rates and that it should not be too complicated to find them a good fit for a good price.

Acknowledging and then tackling these myths head on with customers will help diffuse confusion while giving fitting customers with the best options for possible for them. The reports are right; the coverage gap in this country does offer a huge opportunity for salespeople to capitalize on and recognizing and then debunking these myths is the first step.