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Who Needs Life Insurance?

Who Needs Life Insurance

Written By Doug Mitchell

Doug Mitchell, CLU holds a BA degree in Finance from Auburn University as well as having obtained a Chartered Life Underwriter (CLU) designation from The American College in Bryn Mahr, PA.  Doug has spent close to 30 years in the insurance and financial planning industry and has held licenses to sell securities, long-term care insurance, health.  Doug is also a financial blogger addressing the topics of life insurance, annuities and retirement income planning.

Holly Mitchell  &

Holly Mitchell’s background in life insurance insurance goes back to 1985 when she worked for her father who was a New York Life agent. Holly has a marketing degree from Auburn University and has had a life insurance license since 2008. In addition to advising life insurance for customers all around the country, Holly is our website fact checker.

Rob Pinner   &

Rob Pinner is the founder and CEO of Pinner Financial Services servicing all 50 states. Rob started his insurance career in 2002.

Louis LaBash

Results-driven and innovative life insurance professional with 30 plus years of life insurance industry sales and marketing experience. Recognized as a pioneer in the field, leveraging phone and internet channels to exceed personal sales of over $100 million during the first decade of the 21st century. Creator of a highly effective intuitive IUL life insurance sales software that facilitated the sale of millions of dollars of indexed universal policies by numerous life insurance agents. Proven track record as a Managing General Agent (MGA), Life Agent, IUL Life Insurance Sales Software developer, and leading-edge creator of insurance marketing tools, educational content, and delivery systems.

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If you’re someone who believes you don’t need life insurance, you may want to reconsider.

Buying a life insurance policy isn’t just for parents and married couples. According to recent statistics, more than a third of American households would suffer if the primary income-earner passed away.

Still, only 59% have a life insurance policy to cushion the financial impact.

If the worst should happen, life insurance can provide a death benefit to help replace your income. Your beneficiary can use it to cover burial costs, mortgage payments, and daily living expenses.

Here are several situations where it could pay off.

Who Truly Needs Life Insurance: The Complete List

Single Moms

Single moms are the primary caregivers and financial providers for their children. Without a partner to fall back on, it’s scary to think about what would happen if you were no longer around.

After all, someone will have to care for your kids after you’re gone.

Costs such as childcare expenses, food, clothing, sports activities, and college tuition can add up fast. Life insurance can create a financial safety net for your children and the person left to care for them.

Single Adults

Since no one is relying on your income if you’re single, you may believe you don’t need a life insurance policy. But, what about funeral costs and future health concerns?

Average funerals today can cost as much as $8,000 or more.

Also, if you have a family history of cancer or heart disease, you have an increased risk of developing those health complications. This can make buying a life insurance policy more difficult later on, which could leave you in the lurch if you don’t plan ahead.

Stay at Home Moms

You might not make a direct financial contribution as a stay-at-home mom, but you do plenty to take care of your family. If you passed away, someone would need to provide childcare, transportation, and cooking and take care of other household activities.

It could cost an exorbitant amount to pay someone else for those services.  Life insurance can help with some of those expenses. It can also safeguard your family’s finances and help them continue the lifestyle they’re accustomed to living.


Without children at home, you probably don’t need a substantial life insurance policy. However, you probably do need some sort of coverage, and this is especially true if you and your partner have debt together.

If you die, your partner could get stuck paying off the various debts you owe, ranging from car loans to credit card bills.

Could they make the payments on their own?

Maybe and maybe not, but it might be a struggle without your income for support. Even a small amount of life insurance can protect your partner after you’re gone. Adding on a little more to help with the monthly rent and utility bills could go a long way.

Young Families

It’s tough to get by financially without two incomes. If money is already tight, a sudden drop in wages might not leave enough for your family to live comfortably.

To look after them when you’re gone, a death benefit could help with the mortgage, childcare, transportation, and college costs.

This can happen to someone young and old, and a new family is actually at their peak earning years, making it a pretty critical piece of their ever-growing financial puzzle.

Life insurance can help shield your family from financial ruin by putting cash in their hands.

Young Children

The chances of having a child pass away are slim. Still, it’s an emotional tragedy. A life insurance policy could pay for funeral costs, family counseling, and medical bills.

The Gerber Grow-Up Plan from the Gerber Life Insurance Company is the most prominent policy for children available today, but this is not the only option.

If you’re trying to decide whether to buy a policy for your kids, shop around and consider the value of whole life versus a term policy to get the best rate.


If you’re a single man without a wife or children, buying life insurance can be a smart move. Developing a health condition could make it extremely difficult for you to get coverage later in life.

Policies tend to cost less if you buy them early, and that can help if you plan to marry or have kids someday. Since you never know what your future holds, it’s best to prepare in advance.


The need for women to have life insurance grows as more become the primary breadwinners in their homes. An NBC News/Wall Street Journal poll found that 49% of employed women say the primary reason they work is that they are the family’s primary source of income.

Replacing your salary may be important, and how much you need depends on your circumstances. You also should take into account that some companies won’t insure pregnant women. Waiting could mean missing out on a quality life insurance plan.


Some retirees can benefit significantly from having life insurance while others might not need it at all. It depends on your financial picture and if someone relies on you as a source of income.

It’s important to review the pros and cons because it’s likely you won’t have any coverage by the time you retire.

Any policy you had with your employer will likely go dormant once you leave the workforce. If you had a term policy, it would probably expire around the same time you reach retirement age, too.

Small Business Owners

Thinking about how to pay your business debts after your death can help your company stay afloat. Cash-flow to maintain operations is also important.

Without a considerable amount of savings, life insurance can help your investors and business partners continue the business.

If you’re one of several co-owners, the proceeds can buy out others’ interests for a smooth transition.

What To Consider

Life insurance coverage isn’t one size fits all. Your situation is unique, and the coverage you need depends on several factors.

  • Kids at home – The cost of living is higher with kids at home, and life insurance can help cover those costs. When buying a policy, consider how long you might need coverage. Children tend to rely on you the most during their childhood years. A term policy that provides death benefits until your kids reach the age of 18 might be a good choice.
  • Income replacement – Probably the hardest part is knowing how much coverage is enough. One way to estimate value is to multiply your wages by ten. If you have a young child, you could buy ten times your salary plus $100,000 for college costs. You can’t get the amount down to the penny, but you can get a pretty good idea of how much coverage you should buy from looking at your income.
  • Debt owed – Your debts don’t disappear when you die. The person in charge of managing your will and estate deals with the money you owe. Having debt with another person could make them responsible for the entire balance, and that could leave them in a financial mess. Adding life insurance to pay off a mortgage, car note, or credit card debt can make it easier on your surviving family.
  • Final expenses – Funerals are expensive. If you don’t prepay your funeral or have a joint bank account set up for this purpose, life insurance could help. Keep in mind that a term policy will only give a death benefit during the coverage period, and that could expire before you pass away.
  • Health history – Certain health conditions can make you uninsurable. Depending on you and your family’s health history, finding a policy with no medical exam might be better. Generally, they’re more expensive than buying one that is medically underwritten. But it might be the best choice.
  • Naming a beneficiary – A beneficiary is a person who will receive the money from your life insurance policy upon your death. It can be one person, two or more people, a trustee, a charity, or your estate. Before naming your minor child, know that state laws often limit how much money a child can get. It’s advisable to review your beneficiaries periodically and to have more than one in case that person passes away before you do.

Do You Need Life Insurance?

Deciding whether to buy life insurance is a big decision that could have significant consequences.

Take your time to consider who relies on you financially and the impact your death could have on their lives. Also, research a few policy options to decide if whole or term life would be more appropriate.

Whichever you choose, reviewing your need for coverage as you go through life and updating your beneficiaries can make sure your wishes are carried out after you’re gone.

Picture of Doug Mitchell, CLU

Doug Mitchell, CLU

Doug Mitchell, CLU holds a BA degree in Finance from Auburn University as well as having obtained a Chartered Life Underwriter (CLU) designation from The American College in Bryn Mahr, PA. Doug has spent close to 30 years in the life insurance and financial planning industry and has held licenses to sell securities, long-term care insurance, health. Some other notable items about Doug: Top of the Table Million Dollar Round Table member (MDRT). (MDRT is a global, independent association of the world’s leading life insurance advisors) | Premier Partner with Lincoln Financial and Cabinet Member | Served two years as President of the Auburn/Opelika Association of Financial Advisors | Life Millionaire status at Horace Mann Insurance Company and was awarded the Life Agent of the Year Award | New York Life, Executive Council Member | Currently serves as President of Ogletree Financial, a life insurance General Agency. | Doug is also a financial blogger addressing the topics of life insurance, annuities and retirement income planning.

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