Saturday School: How Life Insurance Companies Make Money Off You

Saturday School: How Life Insurance Companies Make Money Off You Photo by simon jhuan / Shutterstock.com

If you buy a life insurance policy, your family typically will get upward of $1 million — or even more — when you shuffle off your mortal coil.

How can insurers stay in business with a model that forces them to pay out such vast amounts of cash?

It’s easier than you think. Watch this Khan Academy video to find out how life insurance companies make money — and how long they expect you to live when they sell you a policy.

Do you have life insurance? Why or why not? Sound off by commenting below or on our Facebook page.

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