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September 15, 2004 at 08:00 PM
Reaping Rewards During Life Insurance Awareness Month
By Michael Prochno
September is Life Insurance Awareness Month, and for producers working in the group market, the renewed interest generated by this event can lead to increased sales opportunities.
Life Insurance Awareness Month highlights the need for this critical coverage. Program sponsors will run a campaign that includes print and radio ads, a special “Real Life Stories” section in Newsweek magazine, and more. For additional information on Life Insurance Awareness Month, check out the National Association of Insurance and Financial Advisors Web site at www.naifa.org.
This September is the perfect time to approach new clients or suggest plan enhancements to existing clients. Throughout the month, youll want to remind current and prospective clients of all the benefits of group life insurance. Here are some key points to remember:
Americans are underinsured.
The number of Americans covered by life insurance has been declining for the last 20 years. In fact, 39% have no life insurance at all.
What is more, many Americans are dangerously underinsured. Even though they have life insurance, their coverage amounts are so low that their beneficiaries would find it extremely difficult to maintain their standard of living.
According to current industry guidelines, one to two times salary is the minimum amount of insurance individuals need. This is generally enough to cover burial and final expenses only. For individuals who want to provide limited income replacement for their beneficiaries, four to five times salary is suggested.
Many survivors experience serious financial problems.
When premature death strikes, many beneficiaries are shocked by the financial difficulties they face. Some experience problems immediately. And they may not be able to cover everyday living expenses.
In many cases, both household income and assets decline following premature death; expenses like medical bills and burial/funeral expenses further erode savings. On average, it takes a minimum of four to five years to recover financially from the premature death.
But heres the good news: Employers can help their employees protect their families by offering a wide range of employer- and employee-paid life insurance plans. Group insurance plans provide a convenient and cost-effective way for employees to get some of the protection they need.
Group life insurancea popular choice for employees.
Buying insurance at work has become increasingly common in the U.S., especially among first-time buyers who prefer group plans to traditional agent distribution. Group plans let employees avoid some of the inconveniences commonly associated with buying life insurance.
