Black Americans place a premium on life insurance compared to the general population.
Seventy-five percent of Black American households own some form of life insurance (individual life and group life) compared to 70 percent of the general population.
But where the numbers truly diverge is in the demand for life insurance products.
Six in 10 Black American households (approximately 9.9 million) indicate they are fairly or very likely to buy life insurance for themselves or another member of their household in the next 12 months, compared to just 45 percent of the general population.
These numbers come from LIMRA’s new study, Black Americans: U.S. Life Insurance Ownership, which was conducted in early 2016. The study is based on a sub-sample of 456 Black American households from an original sample of 4,197 households. The study examines data on U.S. life insurance ownership levels, buying patterns, and attitudes of the Black American market.
“Historically, Black Americans have always bought life insurance. They have bought it for final expenses, to help pay for burial expenses,” says Nilufer Ahmed, senior research director, LIMRA Markets Research. “But they are consider it to be an important financial product. They see it as a legacy, something to leave behind for their children.”
Ahmed says that Black Americans are interested in life insurance across generations, but where interest has been particularly strong is among couples with children. Those findings are in line with a 2016 survey from MassMutual Financial Group.
“Black families are very concerned with making sure their families will be taken care of financially in the event of their death,” said MassMutual African American Market Director Evan Taylor in a press statement. “Without end-of-life planning, children and family members may be faced with unnecessary difficulties.”
Education is key
Ahmed says there’s a huge opportunity to reach additional Black American households and increase coverage for that 75 percent who already have policies.
“We asked respondents what would keep them from adding insurance,” says Ahmed. “The response was overwhelming: they had a hard time figuring out what type of coverage they need and how much coverage to buy. That points to a huge need for education.”
Continue on for an infographic that illustrates the demand Black Americans have for life insurance.
Fifty-two percent of Black Americans own individual life insurance as compared to 44 percent of the general population.
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