As the CEO of the LIFE Foundation, I recently participated in an industry meeting with nine chief marketing officers from some of the largest companies in our industry. The subject of the meeting was the crisis of 95 million uninsured American adults and the lack of awareness and concern by these adults as to the need for what our products do.
The question is, why do we have this problem? Part of the reason is the job loss caused by the poorly performing economy, but this is not the main reason. The main reason is the new norm of what consumers deem to be reasonable and appropriate for their lifestyles.
Young people are waiting longer to get married and start families, so the perception is that there is no need for life insurance protection in their 20s or early 30s. Cell phones, cable TV and the Internet have now become necessities and are no longer a luxury.
I recently had a discussion with a young attorney who told me he had just switched his cable, Internet and phone to a combined package deal for $500 per month. That’s $6,000 per year that, some years ago, would and could have been allocated to savings and protection planning. If the attorney has a middle market income of $75,000, this package deal is 8% of his gross income.
His concern is that he doesn’t have sufficient net income to afford life insurance, especially since he doesn’t plan on dying any time soon. This lack of motivation in our younger generations concerns me, because if we lose a generation of buyers, the industry as we know it may never recover.
Life insurance may not be a financial priority now, but what happens to the people dependent on him if he is no longer here providing the income they need to maintain their lifestyle or just pay for basic necessities? We need to do a better job of reaching out to these 95 million Americans to make them aware of why they need our products and what our products do. Part of the answer is to use the nonprofit LIFE Foundation resources to educate and motivate people to make the appropriate decisions.