Life Insurance Considered One of the Most Important Assets for Consumers Grappling with Finances Amidst Pandemic

Rhea-AI Summary

Lincoln Financial Group conducted a Consumer Sentiment Study revealing that 60% of Americans are reassessing their financial futures due to COVID-19. Notably, 25% of millennials acknowledged an increased importance in funding life insurance. The study highlights life insurance as a top financial asset, alongside emergency savings and retirement accounts. Key findings indicate 83% prioritize beneficiary amounts, while 57% of millennials value policies with cash value. The company emphasizes the critical role of life insurance in securing financial futures as Life Insurance Awareness Month approaches.

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• 60% of respondents are reassessing financial futures due to COVID-19.
• 25% of millennials recognize increased importance of life insurance funding.
• 83% prioritize coverage amount when purchasing life insurance policies.
• 57% of millennials value policies that generate cash value.

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• None.

A new study from Lincoln Financial Group shows growing appeal of life insurance among millennials

RADNOR, Pa.--(BUSINESS WIRE)-- As a result of COVID-19, American consumers are more focused on financial planning, with 60% of respondents thinking differently about their financial future, according to a new study from Lincoln Financial Group (NYSE: LNC).¹ With respondents most likely to feel ‘stressed’ or ‘anxious’ about financial planning, consumers are motivated to take action, ranking life insurance as one of the top three most important financial assets to continue funding (after emergency savings, and tied with retirement savings accounts). Nearly a quarter of millennials said the importance of funding life insurance has increased for them, the most among any generation.

“As we head into Life Insurance Awareness Month, it’s encouraging to see the importance of life insurance resonating across generations, with increasing appeal among younger demographics,” said Mike Burns, Senior Vice President of Life Solutions, Lincoln Financial Group. “Life insurance is more than financial coverage in the form of death benefit protection for your loved ones. There are also ‘living benefits’ that can be drawn from a policy, making life insurance an asset that you can buy not just for your family, but also for yourself.”

Building a Comprehensive Life Insurance Strategy

Among life insurance owners or those planning to purchase a policy, income replacement for family in the event of death, covering funeral/burial expenses, and financially protecting family in the case of a chronic illness or disability were the top reasons cited for purchasing a policy. Millennials were significantly more likely than Gen X and Baby Boomer respondents to also cite life insurance’s ability to provide tax-free retirement income as an important reason for selecting coverage or owning a policy.

Overwhelmingly, the amount beneficiaries receive is the top consideration when purchasing a policy, cited by 83% of survey respondents. The ability to also generate savings (cash value) with the policy was important to 57% of millennials, compared to 29% of Gen X and 22% of Boomer respondents. Similarly, 46% of millennials said the flexibility to withdraw money from a policy is important compared to 24% of Gen X and 13% of Boomers respondents.

When deciding when and where to purchase life insurance, it is important for consumers to consider all of their options. Today’s life insurance market offers a diverse set of solutions across various price points so consumers can tailor coverage to their specific needs — ranging from lower-cost Term life insurance that can be purchased through an employer or outside the workplace for simpler needs, to permanent products that provide longer-duration coverage and added flexibility.

Coverage amount was not only the top policy feature cited by respondents, but it was also the top factor when selecting a life insurance carrier, followed by cost. Millennials were significantly more likely than any other generation to also say the speed in which they can get approved for coverage is an important consideration when selecting a carrier. Today, companies like Lincoln Financial have made it possible to potentially get coverage in as little as 24 hours, with a completely digital end-to-end life insurance purchase process, including the potential for qualifying clients to have underwriting labs waived.

“Life insurance coverage is critical in helping families secure their financial futures,” said Ralph Ferraro, Senior Vice President, Head of Product, Workplace Solutions, Lincoln Financial Group. “With workplace open enrollment season underway, Life Insurance Awareness Month is the perfect time to work with a financial professional to assess how life insurance fits into your holistic financial plan and then build a comprehensive life insurance strategy, whether that’s through coverage provided by your employer, a financial professional or both.”

Resources to Help You Plan

To help consumers understand the various ways life insurance can fit into a well-rounded financial plan, throughout the month of September, Lincoln Financial will be publishing expert insights and real-world life insurance stories in its newsroom on LincolnFinancial.com. Today’s insights, found here, are provided by Dianna Parker, a financial planner and National Resource with Sagemark Consulting with more than 30 years of experience helping business owners, individuals and families secure their financial futures with life insurance.

Lincoln also offers the following resources to help consumers begin their life insurance planning process in consultation with a financial professional.

• Life Insurance Planning Guide
• Life Insurance Calculator
• Life Insurance Selection Tool
• Living Benefits Guide

Complete findings from the Lincoln Consumer Sentiment Study are available here.

About Lincoln Financial Group

Lincoln Financial Group provides advice and solutions that help people take charge of their financial lives with confidence and optimism. Today, more than 17 million customers trust our retirement, insurance and wealth protection expertise to help address their lifestyle, savings and income goals, and guard against long-term care expenses. Headquartered in Radnor, Pennsylvania, Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE:LNC) and its affiliates. The company had $324 billion in end-of-period account values as of June 30, 2021. Lincoln Financial Group is a committed corporate citizen included on major sustainability indices including the Dow Jones Sustainability Index North America and FTSE4Good. Dedicated to diversity and inclusion, we earned perfect 100 percent scores on the Corporate Equality Index and the Disability Equality Index, and rank among Forbes’ Best Large Employers and Best Employers for Women, and Newsweek’s Most Responsible Companies. Learn more at: www.LincolnFinancial.com. Follow us on Facebook, Twitter, LinkedIn, and Instagram. Sign up for email alerts at http://newsroom.lfg.com.

Source:

1. Lincoln Financial Group, Consumer Sentiment Study, July 2020-2021

LCN:3741372-083121

View source version on businesswire.com: https://www.businesswire.com/news/home/20210901005950/en/

Lincoln Financial Group:

Jay Russo

860-466-1324

Jay.russo@lfg.com

Source: Lincoln Financial Group

FAQ

What does Lincoln Financial's new study reveal about millennials and life insurance?

The study indicates that 25% of millennials feel the importance of funding life insurance has increased.

How has COVID-19 affected people's views on financial planning according to Lincoln Financial?

60% of respondents reported thinking differently about their financial future due to COVID-19.

What are the top financial assets people prioritize alongside life insurance?

Emergency savings and retirement accounts are ranked alongside life insurance as top financial assets.

What percentage of life insurance buyers prioritize the amount beneficiaries receive?

83% of survey respondents prioritize the amount beneficiaries will receive when purchasing a policy.

When is Life Insurance Awareness Month?

Life Insurance Awareness Month is observed in September.