7 reasons you may need life insurance, even if you think you don't

• Life insurance is crucial for anyone who financially supports a partner, children, or aging parents.
• An average 20-something or 30-something nonsmoker can expect to pay between $10 and $50 a month for a term life policy depending on the coverage amount.
• You'll likely pay more if you work a high-risk job or have extreme hobbies, but those risks alone are reason enough to get life insurance.
• If you're self-employed, starting a family, or paying off debt, it's also a good time to consider buying life insurance.
• Policygenius can help you compare life insurance policies to find the right coverage for you, at the right price »

Most people aren't thinking about life insurance in their 20s, but it's often the best time to buy it.

There are several factors that determine the cost of life insurance, but generally, the younger and healthier you are when you buy a policy, the cheaper it will be (unless you work in a high-risk job or have a penchant for extreme sports, but more on that later).

An average 20-something or 30-something nonsmoker can expect to pay between $10 and $50 a month for a term life policy depending on the coverage amount, according to Policygenius. That's less than the cost of a gym membership to protect your family's financial stability in your absence.

If you don't have life insurance, here are six reasons you probably need it:

1. You're having a baby

If you're planning to have a baby in the next year or so, now is a great time to buy life insurance.

For one thing, most people's health declines with age. The longer you wait to buy a policy, the greater the eventual cost. Secondly, if you're going from two incomes to one - that is, one parent will be leaving a steady paycheck to stay home indefinitely - there's even greater reason to set up a financial safety net before having kids.

If you're already pregnant and you're the breadwinner of the family, it's possible to buy life insurance, though you'll probably get the best rates if you undergo the medical exam before or after pregnancy, according to Policygenius insurance expert Logan Sachon.

Still, if you're already carrying a baby and the need for life insurance feels urgent, some insurance companies will allow you to retake your medical exam a year or two after giving birth and then adjust your rate accordingly.

2. You're getting married

If your soon-to-be spouse relies on your income to live the lifestyle you share, it's a good idea to get life insurance.

Whether they bring in their own paycheck or not, having a life insurance policy in place assures they can maintain a similar standard of living if you die prematurely.

3. You financially support aging parents

The general rule is that if someone else relies on your income to live, then you probably need life insurance.

Most people think of protecting a spouse or children, but according to a 2018 AARP Public Policy Institute report, about 6.2 million millennials and counting are acting as caregivers for a parent, in-law, or grandparent.

If you help out your aging parents, or plan to one day, a life insurance policy ensures they're left with some money for long-term care or personal expenses if you can no longer provide for them.

Policygenius can help you compare life insurance policies to find the right coverage for you, at the right price »

4. You have debt

When deciding on a coverage amount for a life insurance policy, financial experts recommend including your total debt amounts to ensure whoever receives the money in the event of your death will have enough to pay off your outstanding balances in full. The largest debt for most Americans is a mortgage, but you should also consider your student loans, if you have them.

Federal student loans are forgiven upon death, but private loans may not be. If you have a co-signer on your private student loans or you live in a community property state, you may want to consider a life insurance policy.

5. You're self-employed

Life insurance can be incredibly beneficial if you're a small business owner, Anna Baluch reports for Business Insider. If you set up a "Key Person" or "Buy/Sell Agreement" life insurance policy, your employees or key stakeholders will still get paid in your absence.

You can also use a life insurance policy as collateral to secure a small business loan, Melbourne O'Banion, CEO of Bestow, an online term life insurance company, told Baluch. Basically, the death benefit on your policy will go toward paying off the entirety of the loan in the event of your death, and then the remaining amount will be paid to your beneficiaries.

6. You have a high-risk job

Life insurance companies will always consider your occupation when they assess your risk level. Simply put, if you work in a dangerous or high-risk environment, you have a greater chance of dying than someone who sits at a desk all day.

Jobs in aviation, construction, firefighting, mining, oil and natural gas, and a few others will almost always result in a higher premium, according to Policygenius. Still, the high risk alone makes the policy worth having.

Most life insurance policies won't allow people in high-risk industries to add a disability rider, so Policygenius recommends buying a separate short-term disability insurance to protect against temporary loss of income if you get injured on the job or elsewhere.

7. You have extreme hobbies

If you're a thrill seeker with a penchant for extreme sports, you'll probably be deemed higher-risk by a life insurance company. But it's similar to having a high-risk job - you'll pay more to be insured, but the cost is worth it considering the likelihood you'll die from unnatural causes.

If you do have an extreme hobby - like rock climbing, scuba diving, or something equally thrilling - it's best not to lie about it on your life insurance application, Policygenius explains. If you die within the first two years your policy is active and you didn't disclose your regular high-risk activity, the insurance company has the right to decrease the death benefit, or cancel it all together.

As for the cost, you'll typically see either a higher base premium or an extra annual fee calculated as a percentage of your coverage amount. Every insurance companies assesses the risk of hobbies differently, so it's good to comparison shop if this applies to you.

Policygenius can help you compare life insurance policies to find the right coverage for you, at the right price »

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