In the last few years, a lot of concern in the life insurance industry has revolved around how companies issuing such policies can better connect with the millions of young adults in Generations X and Y. While many strategies have been considered, few have really found a great deal of success, and now new data suggests that this might simply be a reality the life insurance industry will have to clear going forward.
There remains a significant disconnect between what Generation X and the millennials believe is important about life insurance and taking the actual steps to purchase it, according to a new study from LIMRA Insurance Research. While the majority of these younger adults say that they probably do need to buy more - or indeed any - life insurance coverage, only about 1 in 5 of those polled said that they are "very likely" to buy it.
This poses an interesting problem for those trying to sell life insurance. If people see the value of coverage but don't actually feel the need to buy it, there might not be a lot that people in the industry can do to sway them, the report said. However, Todd Silverhart, Ph.D., corporate vice president for LIMRA Insurance Research, noted that much of this issue arises from this younger generation of adults having suffered - and perhaps still suffering - from financial difficulties that led them to prioritize costs in other aspects of their lives. Still more people were simply not fully aware of the ins and outs of coverage, and were therefore confused about the benefits it might have.
How widespread is this problem?
Moreover, it seems that even when people go to start the buying process, they're running into other difficulties, the report said. In all, LIMRA estimates that about 19 million Americans have at least sought to obtain life insurance at some point in their lives but hit a snag in the buying process that caused them to abandon it.
For this reason, it might be wise for those in the industry to dig into the numbers a little bit more and determine when and why people get out of the buying process, and see what they can do to make sure that doesn't happen in the future. Clearly, it's not necessarily that these young adults don't want life insurance, but rather that something gets in the way. Identifying and removing those obstacles could go a long way in the future.