Life insurance: A change in buyer's attitudes

Some other key points from the study: 86 percent of consumers generally consider life insurance, but only 70 percent believe they “personally need life insurance.” And, worse still, only 63 percent of those surveyed say they own life insurance.

More findings from the study:

• Consumers want to know what they don’t know. “When asked about factors that are important to them when buying life insurance, understanding what they are buying ranks highest among Americans (36 percent), followed by obtaining the proper amount of coverage (22 percent).” Women (39 percent) want to be certain about what they’re buying while 32 percent of men want that same information. Men on the other hand, “place greater importance than women on getting the best price”: 17 percent versus 11 percent.
• The price barrier. According to the study, there remains a price disconnect for consumers, “even though the cost of basic term life insurance has fallen by about 50 percent over the past 10 years.” In fact, the study revealed that “the cost of life insurance is the top reason people give for not having enough life insurance.”
• Leaving a legacy. Of those surveyed 89 percent say the main reason they own life insurance is to “cover burial and other final expenses followed by replacing the income of a wage earner (65 percent).” And 62 percent see the policy as a way to transfer wealth or leave an inheritance.

According to Robert Kerzner, president and CEO of LIMRA, “The psychology of a life insurance purchase is very complex, and the results of this new study bear that out.” Kerzner adds that by getting “a better understanding of evolving consumer trends and preferences, like the use of technology and the Internet,” such information will translate to companies and advisors more “effectively reaching more consumers” and thus, more people owning life insurance.