Q. Money is tight, and we’re young and healthy. Do we really need life insurance?

A. Every now and then, I see an article in a newspaper or on social media about an untimely death of a previously healthy young person. Often it is cancer or trauma—nowadays, COVID-19 as well. At the end of these articles or posts, a GoFundMe account (or similar) started by friends or family members to help the surviving partner and children cope with the financial ramifications of the loss typically appears. These are important community gestures. However, GoFundMe is not a life insurance company.

Recently, I saw a post on social media about another untimely death, with the usual link to GoFundMe. It involved a resident who died of eclampsia while giving birth. The baby survived, and the GoFundMe was to help provide for the partner and child. I suppose it is possible that even people expecting a life insurance payout would start a GoFundMe account, but I suspect that it is rare. Besides, a typical GoFundMe drive raises just a few thousand dollars, averaging $2,600. How, I worry and wonder, will the survivors make ends meet?

Aside from personal loss of any loved one, losing the breadwinner of a family can be a catastrophic financial event. Consider the death of a resident who stood to earn $300,000 or more per year for the next 30 years. That is a loss of $9 million in expected income. Given how easy and inexpensive it is to insure against that loss, it is a shame to see those losses go uncovered. Consider that a 28-year-old healthy female can buy a $1 million term life insurance policy for just $15 a month. Two quarters a day. You can’t even get coffee at McDonald’s for that, much less a decent latte. This investment represents no genuine financial sacrifice whatsoever for a resident physician, even for those making $60,000 per year.

Physicians, even residents, are not invincible. Although the odds of death for someone in their 20s and 30s are low, they’re not zero. Approximately one out of 2,000 people of resident age (25–35) dies in any given year. There are about 130,000 resident physicians in the country. That means approximately 65 of our trainees die every year. Of course, some of them do not have any dependents, so as sad as their death is, it does not produce the same financial catastrophe as for those with dependents. However, what if we assume half of them do have at least one dependent? I do not even want to know how many of those physicians never got around to buying a good term life insurance policy. I hope that number is zero. But the GoFundMe drives leave me worried.