Life insurance is one of the least-loved financial products. Talking about it is boring, it feels distant from reality, and people prefer to believe myths that save them a few hundred crowns monthly — and cost them tens of thousands when something happens. Here are the five most common.
Myth #1: „I'm young and healthy, this is for retirees“
Exactly the opposite. Life insurance covers situations where you lose the ability to earn — serious illness, injury, disability. Czech social security statistics show that every third Czech experiences a long-term income loss during their productive years. Most often between 30–50.
If it happens at 65, you go to retirement. If at 35, you're 30 years without income and with a family who depended on you. That's exactly what life insurance is for.
Myth #2: „My employer provides it, I'm fine“
Employer life insurance is usually a basic flat package for the whole company — typically 100 000–300 000 CZK death benefit and nothing else. It doesn't cover disability, serious illness, long-term work incapacity.
Second thing: this policy ends when you leave the job. Switch jobs, lose work, start a business — and suddenly you're uncovered. Your own policy stays regardless of where you work.
Myth #3: „Life insurance is mainly about death“
The strongest misconception. „Life“ insurance today primarily covers situations during life — disability, serious illness (cancer, heart attack, stroke), long-term work incapacity. Death cover is one of several modules, not the main point.
Looking at my own policy and clients' policies, 90% of the price goes to living coverage, not death. The risk of dying at 40 is low. The risk of getting cancer, becoming disabled or being long-term unable to work — that's orders of magnitude higher.
Core of a good policy: disability stage III (lump sum payout), serious illness (lump sum on diagnosis), daily indemnity for long-term illness. Add-ons (injury) by situation. The rest is marketing.
Myth #4: „Too expensive, I'll just save instead“
Sounds logical. But there's one problem: insurance activates from month one, while your savings build over years. If you die at 32 with a 4-million mortgage and two children, "saved money" hasn't had time to grow.
Real cost of quality family protection is 1 500–3 500 CZK/month for two people. For that you get coverage you wouldn't save in 15 years. It's not savings — it's transferring risk to the insurer. Like mandatory car cover, but for you as a person.
Myth #5: „Insurers don't pay out anyway, it's all exclusions“
Insurance policies really do have exclusions. But it's not that they don't want to pay — it's that they pay for what they're designed to cover, not for everything. If you insure your car against theft, it won't pay when you crash it. That's not fraud, that's logic.
The real problem is elsewhere: most people never went through the exclusions when buying. They didn't know what was covered. When damage occurs that isn't covered, they blame the insurer.
A good advisor (and this is key) goes through the medical questionnaire and exclusions carefully with the client. If someone later complains about denial, we both know it was fair.
Bonus: the sixth truth no one talks about
„Life insurance isn't about you. It's about the people around you.“
If you're single, maybe you really don't need it much. But as soon as you have a mortgage, partner or child, the question isn't "do I need insurance", but "what would they do if I couldn't earn tomorrow?". The answer "we'll figure something out" isn't an answer.
What to take from this
- If you have a policy, open it tonight and read the exclusions. Most people never have.
- If you have a young family without a policy, book a review by month's end. It's not about money I'll save you now — it's about peaceful sleep.
- If your policy is through a bank or employer, reconsider it. These tend to be the least favourable options.