Americans Don’t Have the Life Insurance Coverage They Need Through Life Stages

A recent insurance industry survey found that almost half of all Americans don’t have life insurance coverage¹. The survey also found that Americans’ changing needs in different stages of life can influence their perception of the importance of life insurance in their overall financial wellness.

The survey found that 67 percent of Americans believe that having life insurance is important to achieving financial wellbeing, but just 53 percent of Americans have life insurance coverage. Where does this disparity come from? It could be from different stages of life, with different pressures and expenses.

What about being prepared for emergencies – how important is that to most people? According to the research, emergency savings is only important to 77% of 18-24 years old, but is important to 93% of people 55 and older. And less than half of those 18-24 year olds perceive life insurance as important to their financial wellness, but over three-quarters of 45-54 year olds consider it important. This connection between American’s age and the importance of being prepared for emergencies also links to the value of financial well-being to them. 59% of 18 to 24 years olds claim that financial well-being allows someone to be prepared in an emergency, but 85% of those 55 and older do. A challenge for most 18 to 24 year olds is that they just graduated and many are paying back student loans so money is tight – but do they understand that life insurance can cost less than a gallon of gas a week?

The study also found Americans with children under the age of 18 view an emergency savings fund extremely important to financial well-being. Twenty-five to 34 year olds closely associate financial well-being with saving for their children’s college – and three in five claim that college saving is important to their financial well-being. Life insurance is important to make sure their dreams for their kids can come true, even if they’re not there to see them graduate.

Later in life, empty nesters are more likely than the average American to say that financial wellness means preparedness for an emergency and associate life insurance with financial well-being. Empty nesters also strongly agree that life insurance helps them “stay afloat in times of crisis”. Fifty-three percent stress the importance of having enough money to retire comfortably and also protecting their income in the face of catastrophic challenges (42%). When the kids leave home, the need for life insurance remains.

Life insurance helps provide financial well-being by paying for funeral costs, help pay bills, and paying off outstanding debt, including a home mortgage. September is Life Insurance Awareness Month, a good time to find out more about protecting your employees. 

The Children’s Health Insurance Program (CHIP) is a state and federally funded health insurance program that provides health insurance coverage to all children who meet chip guidelines.