Every September, agents and brokers across the country turn their attention to Life Insurance Awareness Month (LIAM). With this comes all the statistics about the abundance of underinsured Americans today and articles reporting the break down and what it means in the current economy.
However, while LIAM should serve as an annual reminder to agents and brokers about the great opportunity to close life insurance coverage gaps, it seems the situation still has not improved.
While statistics announced during LIAM 2009 revealed that Americans recognize the importance of owning life insurance, the number of policyholders who have scaled back or dropped insurance completely is a clear illustration that Americans are unclear on solutions. Among Americans who altered their life insurance coverage last year, one-third lost coverage completely as a result of a job change or loss, according to The Life and Health Insurance Foundation for Education. Meanwhile, 11 percent decreased coverage and 14 percent cut life insurance coverage completely.
Identifying a problem or challenge is an important first step that helps uncover an opportunity. However, it’s time to shift the conversation from the problem to focus on viable solutions. Simply telling consumers to close the gap is not enough. Agents and brokers need to understand the options and pass their knowledge along to clients, acting as consultants and making tangible recommendations based on their clients’ individual needs.
This must go beyond the important act of explaining the difference between life insurance policies, to taking into consideration the solutions that are best for different life stages. A single woman fresh out of college has different needs than a newly married couple or one expecting children. And with 83 percent of employers citing “controlling cost of benefits” as a key challenge, according to LIMRA, age, life situation, and employment status don’t eliminate the threat of losing coverage.