Andre Dobison, a representative for the insurance company Primerica, explains the theory of decreasing responsibility and how it affects a person’s need for a life insurance policy. Andre Dobison has been working with Primerica since 1985 with the mission of helping families become financially independent and debt free.
Simply put, the theory of decreasing responsibility means that breadwinners of young families have the most responsibility to their children and spouses, but as children grow older, these financial responsibilities decrease. The need for life insurance peaks along with these family responsibilities.
For a younger person, less time has passed to accrue savings and wealth, and the likelihood of having large debts, such as a mortgage payment, is higher than for older people. To responsibly protect loved ones, it is important to have a life insurance policy at this crucial time when the death of the primary earner in the family would have serious consequences. As the family ages, the need for this type of insurance lessens as personal wealth and resources typically increase.