According to the 2022 Insurance Barometer Study, conducted by LIMRA and Life Happens, 106 million adults lack life insurance, or adequate coverage. The need gap, what people have versus what they said they need, is at an all-time high and more than double what it was 12 years ago. Nearly half of all households are underinsured, putting them at risk of not being able replace their income and missing out on a valuable financial tool.
Here are the 10 things you need to know about life insurance today:
- Not all carriers have the same appetite. Highly rated carriers underwrite chronic conditions, past episodic medical situations, medications, even CBD and medical cannabis usage, differently. Find the market that meets your specific situation and needs.
- Life changes, your policy might also need too. Consider reviewing your policy at least every three years to make sure it still makes sense for you and your circumstances. Your need for life insurance may have increased or decreased. Your health may have improved, qualifying you for a better rating. Your family or business situation may have changed. You may be able to increase your term or benefit.
- Put a name on it. When naming your beneficiary – the person who receives the benefit of your policy – one is not enough. You should consider two more in case the unthinkable happens, buy you should not name minors as outright beneficiaries.
- Quicker and easier than you think. It may be possible for healthy individuals to get life insurance in as little as 24 hours and without blood tests.
- It is actually pretty affordable. The top reason people cite for not buying life insurance is it is too expensive. It may be possible to get coverage for less than your monthly utility bill.
- No magic number. When it comes to how much life insurance coverage your family needs, there is no “magic number.” Use the online calculators available or speak with your trusted agent. YOUR number will be based on age, income and other assumptions, immediate cash needs, and long-term income needs, among other considerations.
- You can use life insurance now and later. There are flexible policies that also provide “living benefits” to address needs for every stage of life, such as retirement income or charitable gifting.
- Prepare for care. Certain types of life insurance can be used to help protect against potential long-term care expenses in the future. Start building your long-term care plan with these resources.
- Life at work. According to the Insurance Barometer Study, 57% of U.S. workers have life insurance through their workplace. Your employer may offer coverage for free. Plus, you may be able to buy additional coverage there too.
- Get and keep talent. With fierce competition for workers, life insurance can play a key role in recruitment and retention as well as protecting small businesses.
The best next step for individuals and organizations is to consult with an advisor to start the conversation and determine the strategy that uniquely meets their needs.
DISCLAIMER: This update is general in nature. The information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice, financial advice and/or the advice of a licensed insurance or certified human resource professional.
© SandStone Insurance Partners 2022