Life insurance awareness is probably one of the last things that comes to mind when picturing Gen Z, but recent statistics suggest that they are coming to recognize the importance of this financial safety net sooner than expected. One of the most surprising findings from LIMRA’s 2023 Insurance Barometer Study is that 49% of Gen Z admit they need coverage, suggesting an early generational awareness for life insurance. However, the path from recognizing that need to actually obtaining coverage is one that many young adults are still reluctant to walk down.
To celebrate Life Insurance Awareness Month, a series of blog posts will be diving into each generation’s relationship to life insurance over the next four weeks, highlighting the challenges and achievements of each group in terms of coverage. In this post, we’ve laid out some surprising data regarding Gen Z and life insurance in order to shine a light on the financial futures of our youngest generation of adults.
Gen Z’s Life Insurance Awareness and Coverage
Only 40% of Gen Z currently owns life insurance coverage, leaving a significant gap between those who understand its importance and those who have taken action. What could be holding Gen Z back from finding the protection they know they need?
- Perceived Cost as a Barrier: One of the primary reasons, cited by 29% of Gen Z who don’t own life insurance, is that they think it would be too expensive. This perception might stem from misconceptions about how much a typical policy costs and a lack of awareness of the many affordable options out there.
- Different Financial Priorities: 27% of Gen Z without life insurance said they did not have coverage because they were focusing on other financial priorities. This generation faces unique financial challenges, such as student loan debt and rising housing costs, which can make it feel difficult to budget for life insurance premiums. But finding a balance between current financial obligations and future security is possible, and getting the word out to Gen Z could save them a lot down the line.
- Putting Off the Future: Young adults are prone to procrastination, and a significant 37% of Gen Z who don’t have life insurance said it’s because they simply haven’t gotten around to it. When talking to Gen Z, life insurance agents and financial advisors should emphasize the importance of providing for the future and highlight how easy it is to get a policy when you start young.
- Lack of Outreach: A surprising 26% of Gen Z respondents claimed that they don’t own life insurance because nobody has ever approached them about it. It is crucial that life insurance agents stay proactive in reaching out to prospects from Gen Z to ensure they find financial security and peace of mind.
49% of Gen Z admit they need coverage, suggesting an early generational awareness for life insurance.
The Path Forward for Gen Z
So, how do we bridge the coverage gap for Gen Z? Here are a few ways to address these challenges:
- Financial Education: Gen Z would benefit greatly from financial education that dispels any misconceptions about life insurance early. Explaining different policy types and emphasizing the affordability of life insurance could go a long way in getting Gen Z coverage.
- Digital Accessibility: Gen Z thrives on digital platforms, so user-friendly online tools and apps are essential to getting them coverage. Engagement through social media, influencers and other online marketing channels is key to getting this generation’s attention.
- Proactive Outreach: Gen Z understands the need for life insurance coverage, they are just waiting for an agent to help them find it. It can be as simple as reaching out to these young adults about the importance of finding financial security early in life.
26% of Gen Z say they don’t own life insurance because nobody has ever approached them about it.
While there is a noticeable gap between Gen Z’s recognition of the need for life insurance and their actual ownership, this generation holds significant potential for achieving financial security and peace of mind. By reaching out to young prospects, addressing their concerns and sharing accessible information, anyone can help Gen Z protect their legacies and ensure a more secure and prosperous future for all.
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