Let’s face it — the fact that you are here, reading this article about life insurance statistics, probably means that you’ve been considering getting a policy for a while.
There comes a time when we are forced to reevaluate our priorities and consider the people we love the most.
This is where life insurance comes into play, as it helps families deal with any potential financial issues accompanying the death of a loved one.
Without further ado, let’s see what the latest stats have to say.
Top 10 Life Insurance Stats
- There are 267 million life insurance policies currently in place in the US.
- Life insurance made up 45% of all premiums sold worldwide in 2019.
- Eight out of ten millennials believe they need life insurance.
- 44% of consumers opted for permanent life insurance in 2019.
- 40% of US adults have either insufficient coverage or no insurance at all.
- 47% of women own life insurance in the US, compared to 58% of men.
- 50% of consumers would buy insurance if the process was simpler.
- Total benefits and claims amounted to $747.4 billion in 2020.
- 44% of millennials overestimate the cost of annual life insurance premiums.
- 81% of Americans think life insurance is too expensive.
General Life Insurance Facts for 2022
How much do you really know about the life insurance industry? Do you keep in check with the latest trends and figures? Keep on reading and find out!
(McKinsey)
Annuity remains the most popular life-insurance-related product worldwide, with a steady 30% share.
It’s followed by group, endowment, and unit-linked insurance.
Finally, term life insurance was the least popular, accounting for 9% of the sales.
2. Of a total of 57% of insured consumers in the US, 39% purchased individual insurance, while 28% relied exclusively on this kind of coverage.
(True Blue Life Insurance)
In turn, life insurance stats show that roughly 36% of adults own group life insurance, and that 18% opted for group insurance only.
Only a small cohort of 11% owns both group and individual life insurance.
3. Life insurance statistics for the UK from 2019 suggest that approximately 30% of the population has some kind of life insurance.
(Yu Life)
This percentage roughly translates to 1.1 million mortgaged properties, 8 million households, and 20 million people.
On the other hand, approximately 8.5 million adults are currently without any form of life insurance, 19% of which report having life insurance earlier.
(Investopedia)
Meanwhile, men who are just 10 years older would likely have to pay $486 per year for the same face amount ($250,000). This 10-year delay results in a cost increase of $2,720 during the term of the policy.
5. According to the US life insurance statistics for 2019, 44% of consumers opted for permanent life insurance policies.
(True Blue Life Insurance)
Although permanent life insurance sales have recorded a rise of 9% in recent years, term life insurance remains the choice of 71% of consumers, with a sales growth of 8%.
Whole life insurance dominated the permanent insurance market in 2017.
However, its share dropped to the level of universal and variable permanent insurance in 2019, with all of them attracting roughly equal amounts of interest from consumers.
6. Life insurance claim statistics from 2020 reveal that the total benefits and claims amounted to $747.4 billion.
(Insurance Information Institute)
This includes death, disability, and annuity benefits. The highest amount paid to policyholders who voluntarily terminated or cashed in their policies was $323.4 billion.
7. Recent life insurance numbers show that 47% of women in the US own life insurance, compared to 58% of men.
(Limra)
Studies reveal that women generally admit that they are not too familiar with the basic life insurance facts, with only every fifth woman stating that she is well-informed.
This might explain the difference in the insurance ownership percentage and the gradual decrease in policy sales among women.
Millennials Life Insurance Statistics
Millennials are often described as somewhat averse to taking financial risks, making them a perfect target group for insurance companies. But how informed are millennials about life insurance, and how likely are they to buy?
8. Approximately eight out of ten millennials believe people of their generation need life insurance, recent studies reveal.
(Greenwald Research)
One of the interesting life insurance trends in 2020 was a growing insurance-related interest in millennials, who are reevaluating their financial status primarily due to the COVID-19 pandemic.
Studies reveal that the pandemic prompted 26% of surveyed millennials to open an emergency fund, while 15% cut back on their retirement savings.
Since an average millennial doesn’t have more than $5,000 in savings, these numbers are not encouraging.
9. Life insurance demographics show that 44% of millennials believe that term life policies cost over $1,000 per year instead of the actual average of $160.
(Life Happens, Greenwald Research)
Millennials are also struggling with determining the right amount of insurance coverage. Only 38% of survey participants actually calculated the required coverage.
10. According to life insurance stats, 29% of millennials look for financial advisors on the internet.
(Best Life Rates, True Blue Life Insurance)
Moreover, millennials account for 51% of the total adult population that relies on social media to find financial advisors.
The pandemic era of 2020 marked the rise of online sales statistics for life insurance.
When it comes to insurance company research, Facebook is the most common go-to platform, followed by Instagram, Twitter, LinkedIn, and YouTube.
11. One of the more worrying trends in life insurance is that only 10% of millennials have sufficient insurance coverage in the event of an unexpected death.
(Forbes)
The average coverage of insured millennials amounts to $100,000, close to five times less than their actual coverage needs of $452,000.
Consequently, this age group recorded a disturbing shortfall of required insurance coverage amounting to 78%. The matter is less aggravating for Gen X, who report a 48% shortfall, and baby boomers with a 37% shortfall.
US Life Insurance Industry Statistics
Although life insurance does occupy the mind of your typical American wage earner, the truth is that many are still generally uninformed about even the basic life insurance statistics or haven’t yet revisited their financial priorities.
So, let’s get down to brass tacks!
12. Around 267 million life insurance policies are currently active in the US.
(Best Life Rates)
As per life insurance sales statistics from March 2020, the total amount of direct written insurance premiums is $174,072,717,982.
The top five insurance companies dominate the market with roughly 30% share, and these are Northwestern Mutual, New York Life, Metropolitan Group, Lincoln National, and Prudential.
13. Limra life insurance statistics for 2021 show that as many as 40% of Americans don’t have enough life insurance coverage or no life insurance at all.
(Limra)
We’re talking about 102 million adults who are underinsured or who never got around to buying life insurance in the first place.
The good news is that an unprecedented percentage of the consumers, amounting to 36%, are interested in buying life insurance within the following year.
14. According to life insurance statistics for 2021, an overwhelming 81% of the study respondents didn’t buy life insurance because they think it’s too expensive.
(Life Happens)
This information goes hand in hand with the fact that most Americans wrongly believe that life insurance costs are at least three times higher than they actually are.
15. 42% of American households with dual incomes would be in a serious financial predicament within half a year if a family breadwinner died unexpectedly.
(Limra)
Many families rely on the insurance coverage included in workplace benefits.
However, work life insurance facts confirm that only 35% of men are satisfied with the insurance coverage provided by their employers, while this is the case with 22% of women.
Experts claim that the average insurance coverage sufficient to secure the family household should be 10 times the amount of a consumer’s salary.
16. As life insurance statistics from 2020 show, 84% of Americans who bought life insurance did so mainly to finance their funeral and other final expenses.
(Statista, True Blue Life Insurance)
In addition, research findings from the past decade show that consumers are most likely to buy life insurance to finance the education of their dependents, provide them with an income replacement, or leave them an inheritance.
17. Life insurance statistics for 2021 reveal that 50% of consumers would be more eager to buy insurance if the underwriting process was quick and simplified.
(Best Life Rates)
Nobody likes bureaucracy, so some insurers offer a so-called “no exam life insurance policy,” essentially meaning that the buyer can skip the tedious medical exams and have their policy approved electronically.
This convenience comes at a cost, and quite literally so, since this expedited process entails a higher price.
Life Insurance Fun Facts
Last but not least, we made a collection of the most interesting insurance-related facts. Dive right in!
18. In 2018, Limra recorded as many as 19 million individuals who started and never completed the process of buying life insurance.
(Life Insurance Blog, Limra)
The root cause of this is the extensive medical examination which many consider too uncomfortable.
Life insurance facts show that more than half of total consumers are happy with skipping medical examinations.
At the same time, 48% report higher chances of purchasing a policy due to the possibility of expediting the underwriting process.
19. 4 out of 10 individuals who own life insurance wish they bought it when they were younger.
(Limra, Investopedia)
Most people don’t realize that, due to a lower risk of death, life insurance costs substantially less when you are younger and healthier.
Here are the key factors that influence your life insurance quota according to life insurance facts and statistics:
- Age
- Gender
- Smoking
- Health
- Lifestyle
- Family medical history
- Driving record
20. 51% of uninsured adults claim they don’t have insurance because they don’t like thinking about death.
(Life Happens, Investopedia)
It’s true — nobody wants to think about losing a loved family member, and some abhor the idea of involving finances in the entire matter.
This is one of the common reasons people are reluctant to purchase insurance, according to the newest life insurance industry facts.
(Life Insurance Blog)
Whole life insurance is more popular with older age groups due to lifetime coverage and cash value buildup.
According to life insurance demographics data, of the portion of millennials who bought permanent life insurance, 46% chose whole life insurance, and 25% bought universal life insurance.
FAQ
How many adults have no life insurance?
A total of 43% of adults have no form of life insurance. The latest life insurance statistics for 2020 by Limra report that every fourth middle-class American is completely uninsured.
In light of this situation, 51% of Americans admit they would have to revisit their financial decisions if they lost a family member.
What is the best age for life insurance?
Put simply — the younger, the better. Unfortunately, most people wait until they start experiencing health problems, which drastically increases the premium quota and may even leave them ineligible for insurance in general.
Life insurance industry trends suggest considering your purchase even before you start a family and accept financial responsibility for its other members.
Is life insurance worth it?
If you’re having doubts, it’s best to work out what you want from your insurance policy.
Think of life insurance as an emergency survival kit you can leave to your loved ones. Term life insurance is your best bet if you need coverage during a specific period, while permanent insurance is valid for a lifetime.
Term life insurance payout statistics are more favorable in terms of return on investment, but only if your family members are forced to claim the insurance.
In contrast, whole life insurance offers you a guaranteed return of your money plus the cash value buildup.
What are the benefits of life insurance?
Life insurance can help with many financial burdens such as mortgage loans, living costs, childcare, and education fees, enabling the family to continue covering ongoing expenses and any potential debts that the deceased may have left behind.
Based on last year’s trends in life insurance, most Americans purchased an insurance policy for one or more of the following major reasons:
- 91% wanted to cover their final expenses
- 63% wanted to be able to provide inheritance money to their beneficiaries
- 66% wanted to offer a substitute for the lost income
Which state buys the most life insurance?
Recent statistics reveal that most policy sales were made in California, while Wyoming had the lowest insurance sales output.
It seems that 2018 was a prolific year for life insurance sales in the US, as the number of policy purchases reached 28 million.
The Bottom Line
Hopefully, this set of life insurance statistics has given you some food for thought and made you consider the benefits of an insured future.
Life insurance is more accessible and undeniably more needed than ever, and all it really takes to decide is to learn the basics and pick the right policy.
Honest advice? Reach out to an insurance professional, purchase a policy today and ensure a stable tomorrow.
Sources
- Best Life Rates
- Forbes
- Greenwald Research
- Insurance Information Institute
- Investopedia
- Investopedia
- Investopedia
- Investopedia
- Lewis & Ellis
- Life Happens
- Life Insurance Blog
- Limra
- McKinsey
- Statista
- Statista
- True Blue Life Insurance
- Yu Life
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Tamara Ilic
As a translator with a degree in English language and literature, Tamara’s work requires a lot of research, problem-solving, and creativity. Her lifelong objective is to master as many languages as she possibly can — she is fluent in four and is currently learning a fifth language. As a person with a restless and curious mind, she finds the written word is the best way of clearing and expressing one’s thoughts, so she invests a lot of effort and love in her writing. She recharges her batteries by spending time with her dog, reading a good book, finding new music, or traveling.
