Father’s Day presents an opportune time to look at life insurance trends as they affect adults in general and fathers in particular.
According to LIMRA research, both men and women are less likely to own life insurance today than they were in 2004, but the declines were larger for men. Men are now approaching the traditionally lower ownership rates of women. Thirty-nine percent of men and 43 percent of women have no life insurance coverage at all.
Most notably, middle-aged (35-54) married men are typically in their highest earning years, and half are fathers. Yet, this group had double-digit decreases in the proportion owning individual life insurance from 2004-2010.
Life events — such as marriage, the birth/adoption of a child and buying a house — are cited as reasons to shop for life insurance, yet the top reason to shop for insurance is “to review need and adequacy of coverage.”
LIMRA studies show half of all consumers believe someone in the household does not have enough life insurance. One obvious opportunity for advisors is reaching out to husbands and fathers about their coverage, as this group has plenty of solid reasons to have sufficient life insurance coverage. One-third of new parents agree they lack enough life insurance, yet 6 in 10 new parents don’t shop or buy life insurance within two years of the birth, according to LIMRA research.
Another opportunity exists by targeting fathers and mothers with no life insurance. Uncertainty about what to buy causes men and women to procrastinate. An advisor fills a real need when educating the uninsured about life insurance options that meet their needs. Twenty-five percent of uninsured households say the reason they have not bought life insurance is because no one has approached them about it.
Finally, advisors should reach out to the workplace. For employers, life insurance can be relatively inexpensive whether they choose to cover the entire cost, share the cost with employees, or offer it as a voluntary benefit. Two in 10 households say they prefer to buy life insurance through the workplace in the future. These households say the workplace is an easy and convenient way to buy (33 percent), believe it will cost less or be a better value (26 percent), trust their employers (20 percent), and like being able to have the premiums deducted from their paychecks (13 percent).
There are plenty of good reasons for fathers to consider their life insurance coverage. An advisor who reaches out to a father provides a valuable service to both Dad and his family.
Happy Father’s Day!
Originally published on LIMRA’s Industry Trends blog.
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