If someone depends on you financially, you should consider purchasing a life insurance policy, according to the Insurance Information Institute (Triple-I).
“September is Life Insurance Awareness Month and Triple-I participates each year as the insurance industry focuses on educating the public about the essential financial protection a life insurance policy provides,” said Michael Barry, chief communications officer, Triple-I.
Life insurance policies protect against the death of a policyholder in the form of a payment to a beneficiary. Individuals should consider buying a life insurance policy if any of these three criteria apply to them, according to Triple-I:
- Someone depends on you financially and will need significant financial resources after your death
- Your estate has insufficient assets (e.g., cash, investments) to cover its taxes and debt
- You wish to cover your funeral and burial expenses
The 2023 Insurance Barometer Study, released by LIMRA and Life Happens, found that life insurance ownership among younger Americans increased between 2022 and 2023. Gen Z (aged 18 to 26) life insurance ownership grew from 34 to 40 percent year-over-year whereas Millennials (aged 27-42) went from 45 to 48 percent within this same timeframe. Among insured Gen Z and Millennials, more than six in 10 own permanent life insurance.
Permanent life insurance combines protection against premature death with a savings account and remains in-force throughout the policyholder’s lifetime. Term life insurance covers the policyholder for a certain period and pays a benefit to a beneficiary only when the policyholder dies within that period.
“About two in five adults that participated in the Barometer Study’s survey said they’re only somewhat, or not at all, knowledgeable about life insurance,” Barry said. “Life Insurance Awareness Month provides an opportunity for the industry to educate the public about these policies and to overcome one of the biggest obstacles to selling life insurance.”
The study surveyed adult consumers who are financial decision-makers in their households and generated more than 8,000 responses earlier this year. It also noted a significant number of Americans, no matter their age, only have group life insurance coverage through their employer, not a separate policy purchased through an insurer.
Group policies can expire upon termination of employment.