According to a recent study by two insurance industry groups, less than 60% of Americans have life insurance these days—the lowest percent since the 1960s. Latinos notably bring up the rear here, with 54% insured (that’s against 76% of Blacks and 62% of Whites) despite the fact that, in poll after poll, the vast majority acknowledge that insurance is important to have. (Among primarily Spanish-speaking Latinos, coverage is even lower.)

In a Tomás Rivera Institute study on the issue, a 21-year-old study participant explained this discrepancy by saying, “When money is tight and you have other things going on, insurance is hardly your top priority.”

So how important is it? Here are five things you need to know.

Some Latinos really don’t need life insurance.

If you’re young and don’t have dependents—either kids, parents or anyone else your income supports—you likely don’t need life insurance yet. This is especially true if you don’t have any debts and have enough savings on hand to cover your burial costs. But once you have kids …

You’re probably more valuable than you think.   

Let’s say a family of four relies on one $60,000 income to cover all of their expenses. If the breadwinner dies at 40, over the next 50 years, the family has lost over $2 million.

Your job isn’t taking care of it.  

Most people who have a full-time job assume they are already covered by a policy wrapped into their benefits package. But, says Byron Udell, founder and CEO of Accuquote.com, while many companies do provide coverage, typically they only pay out between $10,000 to $25,000: Enough for funeral expenses, but not even close to replacing a lost income or paying off death taxes, outstanding debts, or other unexpected costs.

Stay-at-home moms can use life insurance, too.

According to Udell, stay-at-home moms would make over $100,000 annually for all of the services that they provide for their families. (Think childcare, cleaning, laundry, cooking, transportation and home maintenance, etc.) With young Latinas making up an ever-larger portion of the SAHM demographic, this is a statistic particularly pertinent to our community. Although life insurance will never replace a parent, it can help the household keep going should a SAHM die suddenly.   

It can be expensive—or not.

According to Udell, the family of that 40-year-old breadwinner cited above could be covered for life by a policy beginning at around $109 a month. “They’d get the whole amount, which would cover their expenses at their current standard of living, including three percent monthly inflation.” But there are less expensive options, too: A healthy forty-year-old man can get a 20-year term policy yielding $500,000 for around $30 a month; a woman or someone younger could probably get it for less. The key thing is to shop around, and beware of bullying—there have been lawsuits against insurance carriers that targeted minority groups for more expensive policies. Make the internet your friend and get a lot of quotes.

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