The Opportunity of a Lifetime: Life Insurance for Female Clients

Since its inception, the life insurance industry has focused its efforts on protecting the income-earner of households across the United States. A long time ago, when higher-paying jobs went mostly to men, the industry helped craft policies that would protect their families should something happen to them. Naturally, this created a gender gap in terms of coverage. Astonishingly, even after half a century of women becoming essential income earners in the American household, this gender gap persists. For this reason, marketing your business efforts towards women presents one of the greatest opportunities for growth!

The Numbers: Women Who Have Life Insurance Policies

Let’s break down some basic numbers to illustrate the need to be more inclusive when marketing life insurance to women.  Some key metrics from LIMRA made the rounds recently detailing the disparity.  Let’s look at the findings and zero in on the issue at hand.

In the United States, slightly more than half (54%) of all Americans have life insurance.  Of those, the gender breakdown is as follows:

• 12% more men have life insurance compared to women.
• Women have an average of $192,000 dollars less coverage than insured men ($423,102 for men, $231,342 for women).
• Women live longer than men by an average of 4 years (77 years for men, 81 years for women).
• There are 7 million more women in the United States than men.

So, what does this mean for you and your book of business? Well, let’s dive a little deeper. While wages and equal pay between men and women have been a hot topic in the news over the past several years, the raw disparity between women’s average wages compared to men is around 20% meaning that, for every 1 dollar that a man makes, women make 80 cents. This is not reflected accurately in the disparity of coverage between men and women from above where women with life insurance have 50% less coverage than their male counterparts.

The Reason: Women Undervalue Their Worth at Home and Underestimate Their Need for Life Insurance

A study by Haven Life from 2019 may provide some answers as to why this gap persists despite the fact that more women are in the workforce today than at any other point in our nation’s history

When asked in a survey of people who did not have a life insurance policy in place how much life insurance they thought would be an appropriate amount of coverage, women responded with an average of $175,423 dollars while men responded with $355,348. Both lower than the average amount of coverage for insured women and men but still a nearly 50% gap in how much coverage a woman thought she would need versus her male counterpart. Whether this discrepancy is the result of gender psychology, societal expectations of women and men, or simply a lack of just how valuable women are, financially, to the family unit is not certain.

What is certain, however, is that single women, married women, women with children, and women without children are all massively underrepresented in the life insurance marketplace. This is exacerbated by the fact that in the Haven Life study, women and men were basically dead-even when asked if their death would have a substantial impact on the finances of their families.

The Answer: Reach Out to Women and Discuss the Importance of Life Insurance

Including women in your own outreach to clients not only makes good business sense, but it is also part and parcel of providing excellent client service. When you speak with your married, male clients, do you ask about life insurance for their spouses? Understanding that losing either parent in a household can have serious financial ramifications whether both parents work or not is key to starting an honest conversation about ‘what if?’ when you are setting up a policy.

It is important to have a relationship with your client’s family, and not just with the client themselves. After all, it is their family that you are helping to protect. This goes for advisors as well. There is another metric that is worth mentioning. Nearly 70% of women fire their advisors after their spouse dies. 70 percent. I can’t help but think that maybe if the advisor had spent as much time understanding and getting to know their client’s family, they might fare better should their client pass away.

Trust Financial is committed to helping you include more women in your client book. In our industry, every opportunity is worth chasing. Facilitating the close of the life insurance gender gap is in all of our best interests. Let us know how we can help.