Find Out How Life Insurance Can Protect Your Family

By Updated at 2021-01-28 00:24:08 +0000

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Did you know that 41 percent of all life insurance purchases are event-related? For many of us, life insurance never crosses our minds until we marry, or buy a house or start our own business. While the trigger events are varied, the need — life insurance — is the same. Here are five events that commonly increase a person’s need for insurance. Know someone who has experienced one or more of these lately? Chances are he or she needs some life insurance.


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1. Tying the knot.

When you get married, you share each other’s financial obligations. Would a surviving spouse have enough money to cover your funeral costs and debts?

2. Starting a family.

If something happens to you, where will the money come from to provide the upbringing you would like your child to have? How would they pay for college?


3. Buying a home.

Could a surviving spouse manage mortgage payments, utilities and maintenance costs without your help?


4. Starting a business.

Life insurance is a key to allowing a business to survive the death of an owner.


5. Supporting aging parents.

Many members of the “sandwich generation” are now supporting their parents as well as their children. Life insurance can ensure your parents would continue to be cared for in your absence.


Life insurance ownership

About sixty percent of all people in the United States were covered by some type of life insurance in 2018, according to LIMRA’s 2018 Insurance Barometer Study. Other findings from the study include: Among those with life insurance, about 1 in 5 say that they do not have enough. Half of all adults visited a life company website and/or sought life insurance information online in 2018. Almost 1 in 3 purchased or attempted to purchase life insurance online — about the same as in 2017. Consumers overestimate the cost of life insurance, especially younger generations; 44 percent of Millennials overestimate the cost at five times the actual amount. Half of all consumers say they are more likely to purchase life insurance if priced without a physical examination.

 2019 financial results

Net income after taxes for the life/annuity insurance industry grew 18.1 percent in 2019 to $44.7 billion from $37.8 billion in 2018, according to S&P Global Market Intelligence. Net income before capital gains grew 21.1 percent in 2019 from 2018, but a net realized capital gains loss of $6.9 billion reduced the net income level to $44.7 billion. Premiums and annuity considerations rose 12.7 percent in 2019, following weak growth in 2018, reflecting the 26.8 rise in annuity premiums and deposits, as life insurance premiums were flat. Expenses grew slightly in 2019, up 0.4 percent, following a 10.6 percent increase in 2018. Capital and surplus rose to $422.2 billion in 2019, up 5.5 percent from $400.1 billion in 2018, according to S&P Global Market Intelligence.

 Life/Annuity Sector

Traditional life insurance is no longer the primary business of many companies in the life insurance industry. The emphasis has shifted to the underwriting of annuities, which accounted for 48 percent of life/annuity direct premiums written in 2018. Annuities are contracts that accumulate funds or pay out a fixed or variable income stream. An income stream can be for a set time period or over the lifetimes of the contract holder or beneficiaries. Accident and health insurance, which includes distinctive products apart from traditional health insurance, accounts for 27 percent of direct premiums written. Traditional life insurance products such as universal life and term life for individuals, and group life, remain an important part of the business, making up the remaining 25 percent of direct premiums written. In addition to annuities, accident and health, and life insurance products, life insurers may offer other types of financial services such as asset management. Traditional health insurance, which is not included in this section and are not considered a part of the life/annuity sector, are described under Private Health Insurance. Health insurance pays for medical, surgical and hospital services received by the insured, as well as routine and preventive care, usually within a network format. Of the many types of plans available, most include a deductible paid by the insured, and benefits received are tax-free. Accident insurance and health insurance, which is included in the life/annuity and property/casualty (P/C) sectors, encompass a variety of specialty products related to health, such as reimbursement for the time a policyholder spent in a hospital or was disabled; short- and long-term disability based on employment; long-term care, and critical or catastrophic illness insurance. Accident and health insurance are not meant to replace health insurance. MORE STORIES: > What to Expect When Filing an Auto Insurance Claim


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