More than half of working women are very concerned about the financial security of their families in the event of their own premature death, according to MetLife Inc.’s eighth annual Employee Benefits Trends Study.

Although that percentage eclipses the percentage of concerned men, women are more likely to be underinsured than are their male counterparts. Especially in this economy, the ramifications of being underinsured for life insurance could be devastating.

As 51% of working women surveyed admit that they are living paycheck to paycheck, according to the same study, many have no savings to dip into in the event of an unexpected loss. While it may be challenging in this economy to discuss a family’s future when employees are focused on the present, it is important to address the following questions:

o How will family members survive if those stretched paychecks suddenly stop altogether? Life insurance is not simply a death benefit; it helps ensure that the family’s income continues.

o How can I assist in closing the life insurance underinsured gap? Producers, employers, and carriers each can play an instrumental role in helping employees obtain adequate life insurance coverage to better secure their financial safety nets.

Narrowing the Underinsured Gap

A growing number of dual-income and single-parent families depend on the income of working women. With the added responsibilities of raising a family and caring for aging parents, the need for adequate coverage in the event of premature death becomes even more apparent.

Yet despite their desire to protect loved ones, women are participating in group life insurance plans at significantly lower coverage amounts than are their male counterparts. According to the MetLife study, insured working women generally have less than three times their annual household income in coverage. Lack of sufficient coverage amounts may leave women’s dependents and beneficiaries in a financial bind in the event of a loss.

Important life events such as marriage, the birth of a child, and home ownership can lead women to realize that their financial needs may increase as their lives change. Unfortunately, these concerns do not always translate into action to obtain adequate life insurance.

Producers have an opportunity to help employers make a significant difference in bridging the underinsured gap. An increasing number of employees, including working women, rely on the workplace as the starting point for building a sound financial safety net. In fact, 68% of men and women say they obtain the majority of their financial protection products through the workplace, according to the MetLife study.

Many working women take advantage of an employer-provided basic life insurance benefit of one or two times their annual salary. The MetLife study suggests, however, they don’t give consideration to supplementing that benefit with additional coverage through the workplace. By educating working women about the value of life insurance, employers can help them to provide financial protection for their beneficiaries to maintain their current standard of living and continue saving toward their futures.

Strategic Next Steps

Helping female employees understand their workplace benefits can lead to increased loyalty toward employers and higher retention. This helps maximize the value of the benefits program for employers.

The MetLife study found that non-medical insurance protection benefits– such as life, dental and disability income insurance–are playing an increasingly larger role in affecting employee loyalty, especially among women. In fact, 65% of working women surveyed said these non-medical benefits played a strong role in workplace loyalty.

A few key steps can help eliminate the gender differences in life insurance coverage and ensure appropriate coverage levels for all employees. By promoting the following tactics, worksite producers can help employers to optimize the value of their life insurance programs and assist employees in building stronger financial safety nets:

o Offering the opportunity to purchase supplemental life coverage through the workplace. This gives all employees a method to purchase additional levels of coverage based on their personal needs with the ease and convenience the workplace provides.

o Providing personalized benefits information. The MetLife study found 48% of working women surveyed prefer personalized information about the right coverage amount and cost. This personalized information should include the cost of the coverage, as it seems that many fail to realize just how affordable workplace life insurance coverage can be.

o Promoting life insurance during a period outside open-enrollment season, which can boost participation. A separate enrollment opportunity allows employees to focus on their life insurance needs, rather than having to make all benefits decisions, including those about their health insurance, at the same time.

o Providing access to online tools and resources. Offer a variety of in-depth life insurance assessment and education tools to help female employees understand their needs, assess the right coverage amount and help them easily enroll.

o Offering a life insurance program that is more than a death benefit. Items like will preparation, estate resolution services, and other assistance for beneficiaries, especially when the offering includes face-to-face support, can help increase the value proposition of the benefits program.

Your employer clients looking to recruit, retain and build loyalty among women may gain a strategic advantage by providing benefits that appeal to this key demographic.

Graham Cox is vice president, life products management for Metropolitan Life Insurance Company, New York. He can be contacted at gcox@metlife.com.