LIFE INSURANCE
29 %
According to a LIMRA study , 29 percent of adults are more likely to buy life insurance over the next 12 months — compared to their likelihood to buy before the pandemic .
Life Insurance from page 36
Many families are living paycheck to paycheck as it is . Our research shows that 3 in 10 workers do not have an emergency savings fund at all . Even among those who do , 6 in 10 say it would cover less than six months of expenses .
All of this data underscores the importance of renewing our commitment to make progress in closing the life insurance coverage gap . Just 54 percent of Americans have any life insurance coverage , a notable decline from 63 percent just a decade ago . Our research shows there are an estimated 30 million underinsured American households , representing more than $ 7 trillion in market opportunity . These families may not realize that the coverage they have isn ’ t enough to protect their families .
A new priority One positive aspect that may endure post-crisis , from the consumer perspective , is a general “ reawakening ” to the value and importance of life insurance . According to a LIMRA study , 29 percent of adults are more likely to buy life insurance over the next 12 months — compared to their likelihood to buy before the pandemic .
Interestingly , recent buyers ( those who already bought life coverage within the last 24 months ) seem to be most affected . Sixty-eight percent of them say the pandemic makes them more likely to buy additional life insurance over the next year . In comparison , 22 percent of non-buyers ( who have not purchased any coverage over the same period ) indicate COVID-19 has increased their likelihood to buy .
In some ways , it is logical that those who recently bought life insurance would be motivated to consider more coverage , given the new set of circumstances . The value it offers is likely fresh in their mind from the experience they have already had . However , it is helpful to remember that not every consumer or situation is the same .
Know your audience
LIMRA also focused on how Americans ’ views of life insurance vary by their life stage .* It reveals notable differences among groups of recent buyers . For instance , younger adults ( under age 45 ) are more likely than older ones ( aged 45 or older ) to purchase additional individual life insurance . A full 100 percent of younger singles with children say the pandemic makes them more likely to buy more or again over the next 12 months . Among younger couples , more than 7 in 10 ( with or without children ) who recently bought life insurance say they are likely to buy more as a result of COVID-19 .
The research also reveals that many older Americans with children who recently bought life insurance are more likely to consider it due to COVID . In fact , 65 percent of older couples with children say they are likely to buy it within the next year .
Financial professionals are key
Insurance distribution continues to play a valuable role in helping more people access the product , as consumers affirm that they seek this expertise . Recent research from LIMRA and Boston Consulting Group focused on Americans ’ views and behaviors when buying life insurance during the pandemic .[ 2 ] It reveals that — even as digital purchase options became prevalent and , often , required — many still turned to a trusted professional for guidance . While it was appealing ( for part of the process ) to leverage online options , the purchase only was complete when coupled with reassurance from an agent or advisor . Life insurance is viewed as such an important and personal purchase that many people are not comfortable making a purchase without the help of an expert .
Closing the gap
As an industry , there is so much we can do to have a positive impact and reduce the number of Americans who are financially at risk because they do not have the life insurance coverage they need . LL Global ( the parent organization of LIMRA and LOMA ) is partnering with six other associations — the American Council of Life Insurers , Life Happens , FINSECA , NAIFA , NAILBA , and MDRT — more than 40 carriers ; over 20 of the largest BGAs , IMOs , and broker-dealers ; and several global consultancies in a joint effort to raise awareness of the importance of life insurance .
With your commitment , we can help fulfill the industry ’ s noble purpose and provide Americans a level of financial peace of mind and stability at a time when they need it most .
38 Perspectives Q1 2021