In the 2015 Life Insurance Barometer, 61 percent of consumers said they have not purchased life insurance because of other financial priorities. Not surprisingly, the top priority for all age groups was living expenses, such as rent/mortgage and groceries.
Additional living expenses, such as Internet, cable and cell phone bills were next on the priorities list. Millennials and Gen X tracked higher than other groups with 54 percent of Millennials and 45 percent of Gen Xers making these “screen” expenses a high priority.
It’s obvious for food and shelter to be top financial priorities, but are families prepared if the primary wage earner dies? The Barometer study shows 43 percent of Americans would feel the impact of the death of the breadwinner in 6 months or less. Twenty nine percent said they would be in financial trouble in one month.
“It’s too expensive” is the number one response consumers give for not having some or more life insurance. When asked to estimate the annual cost of a 20-year, $250,000 level-term policy for a healthy 30-year old consumers’ median estimate was $400 with 1 in 4 guessing it might cost $1,000. The actual cost is $160 a year, or $13 a month.
Compared to cell phone, Internet and cable bills which together can easily exceed $200 a month, the cost of protecting a family’s most important financial priorities isn’t so expensive.
When presented with the facts, consumers can make better decisions. That’s why LIMRA and Life Happens have created an infographic on financial priorities and asks “Are they out of sync?”