A recent survey released by LIMRA indicates that 30% of U.S households lack any form of life insurance, a number that has skyrocketed since 2004.
Additionally, just 44% of U.S. househlds have individual life insurance. Both figures represent 50-year lows.
The report is conducted every six years, and observes and analyses the fluctuation of the percentages among insurance holders.
Last year, insurance companies issued 9.4 million individual life insurance policies in nationally, a million fewer than in 2004. During the mid-1980s, almost twice as many policies were issued as compared to today, LIMRA said in a press release.
So what are the reasons behind the rapid decline?
LIMRA reported that 40% of the survey responders claim to have other financial priorities.
Other findings include that only one in four employees depend on their employer to provide financial leverage in case a wage earner dies. Almost 15% said one or more of the family’s main source of income lost their job.
This means no job, no insurance.
Among households with children under 18, close to four in 10 admits that they will encounter severe financial instability if a wage earner suddenly died.
“With so many families continuing to struggle financially, there has never been a more critical time for people to own an adequate amount of life insurance,” said Marvin H. Feldman, CLU, ChFC, president and CEO of the LIFE Foundation in a statement. “This study shows that Americans place great value on the need for protection and half of all families recognize that they need more life insurance than they have.”
This story has been reprinted with permission from Financial Planning.
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