A Family Guide to Life Insurance Awareness Month
Maria keeps a folder in the top drawer of her desk labeled “Just in Case”. Inside are copies of the deed to her house, her children’s birth certificates, and a single sheet of paper listing her bank accounts.
For years, that folder was missing one thing: a life insurance policy. Maria, a 41-year-old social worker and mother of two living in New York, had always assumed she would get around to it eventually. Then, a close friend lost her husband unexpectedly at age 44, and Maria watched her friend navigate funeral costs, a mortgage payment, and two college funds on a single income. That was the moment “eventually” became “now.”
Maria’s story is a common one, and it is exactly the kind of gap that September’s Life Insurance Awareness Month was created to close. Every September, the financial services industry comes together, led by the nonprofit organization Life Happens, to help American families understand a simple but often postponed piece of financial planning: that timing matters.
According to a 2025 LIMRA Study, 51% of Americans currently own life insurance, and roughly 100 million adults say they need life insurance or need more coverage than they currently have. That is not a small oversight. It is a significant and measurable gap between what families know they should do and what they have actually done.
Why Do People Not Explore Life Insurance?
If most people agree that life insurance matters, why does the gap remain so wide? The 2025 Study points to a lack of understanding surrounding life insurance.
“Life Insurance is too expensive”
One key misconception found was the cost of life insurance. Roughly half of Millennials (48%) and 39% Gen Z adults point to cost as the main reason they don’t own more life insurance. Yet, research found that young adults between ages 18 and 30 overestimate the cost of a $250,000 20-year term policy by 10 to 12 times its actual price.
“I’ll get to it some other time”
The second factor is a lack of action. A LIMRA study found that 90% of people who were interested in buying life insurance say they need to understand it better before they buy, yet only two-thirds actually take steps to educate themselves about it.
People recognize the importance of coverage often the same way they recognize the importance of a will or an emergency fund. They simply have not gotten to it. Life events, such as a marriage, a new home, or the arrival of a child, tend to be the moments that finally prompt action, but can also be stressful times to evaluate the role of life insurance for the first time.
Moving Towards Life Insurance Awareness
Social media has become a major way that people research these decisions. 62% of adults now use social media to seek information on financial or insurance products, with usage climbing even higher among younger generations.
Despite that shift toward digital research, the same study found trust in financial professionals remains strong, with the large majority of consumers saying they still want human guidance at key stages of the buying process.
In practice, that means that while many people are using social platforms to start their life insurance research, they turn to trusted financial professionals to help make key decisions for their situation. Working with a licensed professional like an Investment Counselor to explore different products, questions and scenarios can be a thoughtful step to life insurance awareness.
What Life Insurance Actually Does
At its core, life insurance is a contract. You, or a policy owner on your behalf, pay premiums to an insurance company. In exchange, the company promises to pay a death benefit to your named beneficiaries if you pass away while the policy is active. That benefit might replace lost income, pay off a mortgage, cover a child’s education, settle outstanding debts, or simply give a grieving family breathing room during an already difficult time.
Term Life Insurance
The product category is broader than many people realize. Term life insurance provides coverage for a defined period, typically 10, 20, or 30 years, and is generally seen as one of the most affordable ways to secure a substantial death benefit while children are young or a mortgage is outstanding.
Permanent Life Insurance
Permanent life insurance, which includes whole life and universal life policies, covers you for your entire life and builds cash value over time that you may be able to access while you are still living. Some permanent policies now include living benefits riders that allow policyholders to draw against the death benefit early if they are diagnosed with a qualifying chronic or terminal illness, a feature that has become increasingly relevant to how families think about the product.
How Much Coverage Is Enough?
One of the most common questions Investment Counselors hear during Life Insurance Awareness Month is a deceptively simple one: how much coverage do I actually need? There is no single formula that fits every household, because the right number depends on income, debt, dependents, and long term goals.
A useful starting exercise is to add up what a family would need to replace, including several years of income, the remaining mortgage balance, outstanding debts, and the projected cost of raising and educating children, then subtract existing savings and any coverage already in place through an employer.
Most employer sponsored policies provide a death benefit equal to just one or two times annual salary, which rarely covers a family’s full long-term financial picture.
What Coverage Actually Costs
Cost is the single biggest reason families delay buying life insurance, and it is also the area where perception and reality diverge most sharply. Americans across every age group tend to overestimate premiums, and the gap is most extreme among younger adults. For a healthy 30-year-old woman, a 10-year policy can cost less than the price of a monthly gym membership.
Premiums are driven primarily by age, health, coverage amount, and policy length, which is why locking in a rate earlier in life, while you are younger and generally healthier, tends to produce meaningfully lower long-term costs than waiting.
Permanent policies typically cost more than term coverage for the same death benefit, because part of the premium builds cash value in addition to funding the death benefit itself. That cash value can grow on a tax deferred basis, and depending on how a policy is structured, funds may be accessed through withdrawals or policy loans during the policyholder’s lifetime.
Because permanent insurance sits at the intersection of protection and long-term savings, families considering it should work through the tradeoffs with their situation, goals, and long-term needs in mind. Professional guidance like an Investment Counselor can lay out the full cost over a 10, 20, or 30-year horizon rather than comparing a single year’s premium in isolation.
Term Versus Permanent: Making the Right Call
Choosing between term and permanent coverage often comes down to timeline and purpose. A family with young children and a 25-year mortgage may prioritize a large amount of affordable term coverage that runs until the mortgage is paid off and the children are financially independent. A business owner planning for estate liquidity, or a parent who wants to leave a guaranteed legacy regardless of when death occurs, may lean toward permanent coverage, accepting higher premiums in exchange for lifelong protection and the potential to accumulate cash value.
“The mistake I see most often is people treating life insurance as one product instead of a toolkit,” says Joseph Aspelund, Branch Manager of the White Plains office at David Lerner Associates.
“Term and permanent coverage may solve different problems, and sometimes the right answer is a combination of both. That is why this conversation should happen with a trusted professional who can look at your full financial picture, not just sell you a policy off a shelf.”
The Beneficiary Details People Overlook
Naming a beneficiary sounds straightforward, but it is one of the areas where families most often make avoidable mistakes.
It’s a good idea to name both a primary beneficiary and a backup (called a contingent beneficiary). The backup only gets the payout if the primary beneficiary has passed away or can’t be found when it’s time to pay the claim.
Beneficiary designations should also be reviewed after every major life event, including marriage, divorce, the birth of a child, or the death of a previously named beneficiary, because the designation on file with the insurer generally overrides instructions left in a will.
Families with minor children face an additional wrinkle. Insurers typically will not pay a death benefit directly to a minor, so parents who name a child as a beneficiary without also establishing a trust or a custodial arrangement might create a legal delay. An Investment Counselor can help coordinate beneficiary designations with a family’s broader estate plan so that the money moves where it is intended, when it is needed.
You Get Declined for a Policy, Now What?
Not every applicant is approved on the first try, and being declined does not have to be the end of the process. Underwriting decisions (the process an insurance company uses to determine risk level) are typically based on age, health history, occupation, and lifestyle factors, and a decline from one insurer does not automatically mean every insurer will reach the same conclusion, since underwriting guidelines vary from company to company.
Working with an Investment Counselor who has access to multiple carriers can make a meaningful difference here, because they can help find plan that works for an applicant’s specific health history and goals.
Guaranteed issue and simplified issue policies ask few or no health questions, but the tradeoff is a smaller death benefit. For some people, these may work as a practical stopgap while they look into other coverage options.
Reviewing Your Current Life Insurance Policy
Life Insurance Awareness Month is not only for people without coverage. It is also a natural checkpoint for anyone who bought a policy years ago and has not looked at it since. A policy purchased before a divorce, a career change, a significant increase in income, or the payoff of a mortgage may no longer reflect what a family actually needs.
Term policies approaching the end of their level premium period deserve particular attention, since premiums on many term products increase substantially, sometimes dramatically, once the initial term expires.
A periodic review, ideally every few years or after any major change in life, helps ensure that coverage amounts, beneficiary designations, and policy type still match a family’s current circumstances rather than the circumstances of a decade ago.
The Next Steps For Maria
After her friend’s loss, Maria sat down with an Investment Counselor, worked through the numbers on her mortgage, her children’s future education costs, and her family’s monthly expenses, and purchased a 20-year term policy sized to replace her income through her children’s college years.
She also updated the beneficiary designation on the small group life policy she had through her employer, which she had not touched since she started the job seven years earlier. She felt a weight off her shoulders that she had a sound plan in place for her family.
That kind of clarity is the entire purpose of Life Insurance Awareness Month. The data is consistent year after year: most Americans understand that life insurance matters, and most who lack adequate coverage know it. What tends to be missing is not the motivation but the moment, the specific point at which understanding turns into action. September is designed to be that moment.
Where to Start with Life Insurance
If you are unsure whether your coverage, or lack of it, matches your family’s current needs, the most useful first step is a conversation, not an immediate purchase. An Investment Counselor can walk through your income, your debts, your dependents, and your goals, and help you understand which type of policy, and how much coverage, actually fits your situation. For many families, that conversation takes less time than expected and answers questions that have been sitting unresolved for years.
Material contained in this article is provided for information purposes only. It is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities. These materials are provided for general information and educational purposes, based on publicly available information from sources believed to be reliable. We cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.