How Millennials are Changing the Life Insurance Game
There is nothing more powerful than the loss of a loved one to highlight the need for life insurance. And this past year, most of us have felt some sense of loss, collectively if not personally, through the grief and suffering caused by the global pandemic. Many of us who had never spent time thinking or planning for our own death, or that of a loved one, have probably found ourselves confronted with this subject in the past year or so.
The change has been especially significant among Millennials, who are now between 22 and 40 years old, as they begin to plan for the next stage in their lives. A recent study found that millennials are the most likely to be influenced by the pandemic to purchase life insurance. Forty-five percent of millennials said they were more likely to purchase life insurance due to COVID-19, compared to 15% of baby boomers and 31% of Gen X.
And just as millennials have redefined everything from proper work attire to car buying options, they are also reshaping the life insurance market. This digitally savvy group prefers online research and information that they supplement with financial advice from a human professional to make sure they’re on the right track.
Here are several ways the life insurance market has adapted over the past few years and some navigation tips for millennials considering their options:
Reality: Fewer employers are offering life insurance as a benefit.
About 56% of Americans who work for private companies have access to life insurance through their employer. The number of employers offering such benefits, largely through group plans, has steadily declined over the past decade. The result? Over 50% of those with life insurance purchased it individually.
Your move, millennials: If your employer offers life insurance, it’s worth considering the coverage options. You can find the value you need for your situation. You may also find that you need to purchase additional coverage yourself. Many employer-sponsored life insurance plans offer very basic coverage, and the policy may not be transferable if you separate from your employer. This is an important factor for millennials, who tend to have higher job change rates.
Trend Alert: The process keeps getting faster and easier …
Millennials are comfortable researching and buying almost everything from groceries to cars online. Life insurers and agents were already making improvements to digital tools to make it easier for consumers to find and buy life insurance online, but the pandemic has accelerated those improvements. Now it’s easier than ever to collect quotes from multiple insurers, research potential suppliers, and even follow the request and delivery process completely online.
Additionally, the physical data for many policies is optional (but you can always want one). A growing number of insurers have dropped the physical exam requirement in recent years, which means you can buy a life insurance policy without a medical exam or blood tests. No-exam policies generally have faster underwriting times than traditional policies, and they offer the convenience of skipping an extra appointment. But they are not the right choice for everyone. No-exam policies, for example, typically cost more than those that include a physical exam, and coverage can be capped at $ 500,000.
Your move, millennials: With the ease with which you can find and buy insurance, you now have a market of tools and options. The earlier you start, the better, as prices only increase with age.
The good news is, you can do it your way!
Millennial consumers love personalization. With so much information readily available, there is a lot you can do on your own if you want to. And when you’re ready and have questions or want a more guided experience, there’s a finance professional who can help. Whether over the phone, video, online, or in a good old-fashioned face-to-face meeting, a financial professional is always an ideal stop on this journey to make sure you have your needs considered. and your options. There are nuances in the features and benefits of life insurance, and an experienced professional can help you sort it out. Among millennials who purchased life insurance during the pandemic, more than half used a live advisor, and 30% used both a live advisor and online items when making their purchase, according to the Boston. Consulting Group.
In addition to helping ensure the financial security of your loved ones in the event of death, many life insurance policies now also offer optional endorsements (sometimes at an additional cost) that can help with other issues, such as chronic diseases or the risk of longevity.
Your move, millennials: Choose the method that works best for you. This can be an online purchase only, using a live advisor, or a combination of the two. If you don’t know where to turn for help, your employer can give you access to an advisor. It’s also likely that friends or family have a recommendation for you. It is one of the most common ways for advisors to acquire new clients. Finally, many states have registration requirements and often have online directories of licensed finance professionals. Without a recommendation from someone you trust, it’s a good rule of thumb to select two or three people to interview so you can find the best person for you.
As millennials are increasingly likely to purchase life insurance, insurers have evolved their offering to create new products and innovations that meet their needs. This is great news for first-time applicants who may find the process much more painless than expected.
Life insurance is issued by the Prudential Insurance Company of America, Newark, NJ, and its affiliates. 1050737-00001-00
President of Prudential Individual Life Insurance, Prudential Financial
Salene Hitchcock-Gear is President of Prudential Individual Life Insurance. She represents Prudential as a Director on the Advisory Board of the Women Presidents Organization and also sits on the Board of Directors of the American College of Financial Services. In addition, Hitchcock-Gear holds a bachelor’s degree from the University of Michigan, a Juris Doctor from New York University Law School, as well as FINRA Series 7 and 24 Securities Licenses. She is a member of the New York State Bar Association.