Life Insurance Statistics – Consumer and Industry Facts, Studies, and Survey Figures – 2019

Last updated November 22, 2019

The following article is based on extensive research from various studies and surveys conducted between 2011 and 2019 regarding life insurance.[1][2][3]

Here’s some quick facts:

  1. Of the thirteen top financial concerns, life insurance can provide a solution to four of them; education expenses (for dependents), income replacement (for dependents), final expenses and leaving an inheritance.
  2. People like simplicity and convenience, roughly half of consumers (47%) like this about simplified underwriting life insurance policies.
  3. When asked to estimate the cost of life insurance for a $250,000 policy, more than half of people overestimated.
  4. The amount of people who actively shop for life insurance declined by 2%, or around 17 million in 2019.
  5. When it comes to social media, Facebook, Yelp and LinkedIn are equally important to consumers.
  6. One third (34%) of people looking for a financial professional say they would research them via social media.
  7. MetLife Inc was the largest market share holder of life / annuities (14.1% market share) and group life insurance (21%) in 2018.

Table of contents:

Life insurance market research

Top financial concerns of consumers

Every individual has financial concerns, be it retirement, inheritance or perhaps even monthly bills. A study in 2019 collected the main financial concerns of Americans and listed them.

Top Financial Concerns of 2019

At first glance of the statistics above, life insurance may not be an overwhelming concern to the average individual, however of the 13 main financial concerns, life insurance can provide a solution to 4 of them, bumping up the combined percentage of 15% to second place, just below retirement.

Life Insurance Market Penetration

Market penetration for life insurance equals 57% among American adults. It peaked at 63% in 2011. Ownership averaged 59% over the past nine years; it has declined slightly since 2016

Life Insurance Ownership among American Adults 2011 to 2019

Type of Life Insurance Owned

Most adults own life insurance, around 3 in 5 consumers. Among the 57% of individuals that have life insurance, 39% owns individual life insurance and 28% owns individual life insurance only.

Around 36% of individuals owns group life insurance, and 18% owns group life insurance only. 43% of individuals do not own life insurance at all.

Of the 57% of individuals that own life insurance, 69% are male, and 31% are female.

Type of Life Insurance Owned

Life Insurance Knowledge Gaps

The following graphic is a clear example of the association between product ownership and product knowledge. Life insurance owners are more likely to understand basic product concepts, such as the relationship between a person’s health status and the cost of coverage.

Life insurance knowledge by life insurance owners vs non owners

This information affirms the notion that more informed consumers are likely to make better decisions regarding life insurance coverage.

Affordability and value are two obstacles that deter consumers from purchasing life insurance. If more consumers understood life coverage affordability, more consumers would shop for coverage.

Expected Cost of Term Life Insurance Coverage

Lack of general life insurance knowledge causes many consumers to overestimate the cost of term life insurance coverage.

Over half of Americans thinks the cost of a term life insurance policy is 3x or more than its actual cost.

When asked to estimate the cost of $250,000 term life policy for a healthy 30-year-old, over half of the respondents said $500 per year or more.

The average cost of such a policy is closer to $160 per year, suggesting over half the population thinks term life insurance is over three times more expensive than the true cost.

Expected cost of term life insurance coverage

The Millennial generation, much more than Baby Boomers or Gen X, is likely to overestimate the price tag for term insurance. This indicates that marketers targeting prospects in the young adult market need to inform their prospective clients that term coverage is probably much more affordable they think it is.

Life Insurance Types & Products

Most Popular Life Insurance Type

Although the sale of both term and permanent policies increased, term life insurance remains the most common product type purchased.

Type of life insurance product purchased 2017 vs 2019

71% of purchasers bought term policies, another 44% bought permanent policies. These figures represent an increase for both term (+8%) and permanent policies (+9%). The increases for both types indicates more people are buying more than one policy.

Type of Permanent Policies Purchased

In the 2019 study period, one third of permanent life purchasers bought variable life policies, 3 in 10 bought whole life, and 1 in 4 bought universal life.

Type of Permanent life insurance policy purchased

While whole life was clearly the most common type of permanent life insurance in 2017, numbers have become more balanced and people are about equally likely to buy all types of permanent policies.

Simplified Underwriting

About half (47%) of American consumers find simplified underwriting more appealing than traditional underwriting, suggesting that 117 million consumers are more likely to buy via simplified underwriting.

Change in likelihood of buying life insurance due to simplified underwriting

While still popular with consumers, the appeal of simplified underwriting is declining. The proportion indicating it is much more likely to buy (14%) declined by 7%.

Offset by a 2% increase of users saying they are somewhat more likely to buy, and a 6% increase of people saying they feel neither more or less likely, this can be interpreted as an overall decrease of interest by 11%.

Over half of all consumers (a combined total of 52%) says simplified underwriting does not increase their likelihood to buy life insurance coverage.

What People Like About Simplified Underwriting

Despite the drop in overall appeal, the relative appeal of these benefits remains in roughly the same rank order.

117 million Americans say they’re more likely to buy life insurance if the process is simple, fast and transparent.

Benefits of Simplified Underwriting by consumers 2018 vs 2019

63% of individuals finds the most appealing benefit to be the speed and ease of process, although the overall appeal of these benefits declined by 9 points in the last year.

The least appealing benefit of simplified underwriting is avoiding a face-to-face conversation. Even though this is the least appealing benefit, and appeal dropped by 5 points in the past year, it is important to 40 percent of American adults.

Life Insurance Buying Behavior

Why People Buy Life Insurance

Despite the drop in overall appeal, the relative appeal of these benefits remains in roughly the same rank order.

People have many different reasons that drive them towards buying life insurance coverage. The following data shows the main reasons people buy life insurance for the last two years.

Reasons Consumers Buy Life Insurance

The most common reasons for purchasing life insurance haven’t changed in the last two years, and include: income replacement (people want to make sure their dependents financial future are secure), final expenses, wealth transfer and to pay off their mortgage.

Increasingly over the last two years, reasons for purchasing life insurance include: mortgage payoff, replacing another life insurance policy, estate taxes and liquidity, funds for college and charitable gifts.

Less common reasons for purchasing life coverage include: tax-advantaged savings or investments and supplemental coverage for group coverage owned.

The three main reasons people buy life insurance are:

  • Income replacement – Concern for income replacement is about equal to the average of the Financial Concern Index of 2019, which is the highest relative position for any life insurance item in the history of this study. This suggests more and more people are concerned about this issue and are more willing to address the matter.
  • Final expenses – Concern of burial costs and related final expenses remains the second priority for life insurance.
  • Leaving an inheritance – This concern has declined steeply since 2016 when it hit an all time high.

Why People Don’t Buy Life Insurance

The reasons why people don’t buy life insurance have not changed significantly since 2017. The biggest change since then, is that 5% of individuals would not purchase life insurance simply to avoid high pressure sales tactics.

Reasons People Don't Buy Life Insurance

Roughly one third of the population believes they have enough life insurance.

Around 34% of individuals give priority to other financial concerns, such as retirement and long-term care, or prefer other financial products.

15% of people believe they can’t afford life insurance, 4% less than in 2018, which goes in line with the overall financial stability increase of Americans. It’s also important to note that while some individuals can not afford an extra monthly bill, 42% of millennials overestimate the cost of life insurance with an average of 5 times more than the actual cost.

There’s a spike in 2019, 5% of individuals fear shopping for life insurance will just expose them to high pressure sales tactics.

3% of individuals think life insurance isn’t a good product, a 2% decrease compared to 2018.

How People Educate Themselves about Life Insurance

As more and more consumers migrate online to research, shop and purchase in all sectors of the economy, the perceived usefulness, trust and reliability of online sites continues to grow in importance.

Useful Online Life Insurance Sources

Almost half of all life insurance shoppers indicated they learn directly on a life insurance provider’s website, as well as online aggregator websites.

More than one third learns about life insurance through association websites.

About 3 in 10 shoppers found online financial calculators and agency websites to be useful. This seems a low percentage for agency websites, suggesting opportunities for improvements may be available by examining the destinations deemed more useful.

How People Shop for Life Insurance

The 2017 study concluded that 15% of U.S. households seriously shopped for individual life insurance in the prior 2 years, 11% of them got quotes, and 7% purchased policies.

Seriously Shop — The percentage of households seriously shopping for individual life coverage declined from 15% to 13% in 2019, suggesting the volume of shoppers declined to 17 million households.

Evaluate Quotes — The percentage of households getting individual life quotes is roughly the same as in 2017. While the 1% drop is not statistically significant, it equates to 1 million fewer households reaching the quote stage.

Purchase Coverage — The percentage of households purchasing an individual life policy also fell by 1%, a statistically insignificant difference from 2017. Nonetheless, it suggests a drop of 1 million households from the purchase stage.

Where People Quote and Purchase Life Insurance

While more and more people go online to research and shop for life insurance, more than half (59%) of individuals purchase life insurance the traditional way through phone (30%) and mail (29%).

Channels used for life insurance quotes and purchases

Quoting methods — The usage rates of different quoting methods did not change significantly between 2017 and 2019. The 2017 study showed higher rates of quoting via direct mail (17 percent); all other metrics are within three percentage points of their 2017 levels.

Purchase methods — Usage rates for purchase methods are similar in the 2017 and 2019 study periods. The most common purchase method cited in 2019 is direct by phone (30%), up 4% from 2017. Direct by mail is equally common (29%), up 7% from the 2017 study period. The proportion of purchasers citing financial professionals remains consistent, 27% in both periods.

The Importance of Social Media for Life Insurance

Social media is a vital part of American society, and it’s becoming a vital component of the economy.

A new survey found that Americans use YouTube the most, at 73%, a number unchanged from last year. The second most popular social media site is Facebook, with 69% of Americans reporting using the service, a 1% increase from last year

What Social Media Platforms Are Used for Financial Service Research

When asked what social media platforms they use in connection with financial products, services or advisors, most consumers indicate they do not use social media sites for such purposes.

Gen X (17%) and Millennial (29 percent) generations are more likely to be looking for an advisor. These generations are more likely to use social media to research potential advisors, suggesting that more advisors need to build or enhance their social media presences.

Social media platforms used for financial service information

Comparing the numbers of people that use social media to those that use it to research financial service related information indicates that social media does not yet play a substantial role in the area of financial products and services for most consumers.

Yet, each of the sites listed above already has tens of millions of users looking for more information in the financial services space.

Marketers should learn more about the users of social media in this space and learn how financial service marketers can more effectively leverage these platforms to build knowledge and awareness.

Most Important Social Media Platforms for Financial Professionals

Given that millions of people research financial professionals on social media, it’s important to know which social media platform can yield the best results.

85 million Americans use social media to learn more about financial advisors.

When asked to rate the importance of the social media sites, respondents produced comparable levels of importance for all six.

Importance of social media presence for financial professionals by platform

Overall, LinkedIn, at 12%, has the highest rated importance for financial professionals. Yet, Facebook (11%) and Yelp (11%) have comparable importance ratings.

Among Millennials, Facebook (25%) has the highest rated importance for financial professionals. Once again, Yelp (24%) and LinkedIn (24%) have comparable importance ratings.

Information People Want From Social Media

About two thirds of those using social media sites for finance-related topics are looking for information on products and services (62%) or looking for reviews on financial professionals (61%).
This helps marketers understand the type of subject matter consumers will appreciate seeing on finance-related social platforms.

Financial service information people want on social media

Consumers are less likely to use social media to keep in touch with a financial professional (40%) or to communicate with a financial professional on specific topics (36%). Nonetheless, these activities are already taking place on social platforms and will grow over time.

The least common use of social media in the finance space is for testimonials on the merits of financial products. This may present an opportunity for marketers, as testimonials from well-known personalities are generally effective social marketing tactics.

Life Insurance Company Statistics

Life / Annuities Insurance – Top 10 writers of by direct premiums written in 2018

In 2018 the top 10 companies wrote over $355 million of life insurance and annuity premiums.

CompanyDirect premiums writtenMarket share
1. MetLife Inc$96,451,6014.1%
2. Prudential Financial Inc.$53,148,557.8%
3. New York Life Insurance Group $35,452,211
5.2%
4. Massachusetts Mutual Life Insurance Co.$27,154,6114.0%
5. American International Group (AIG)$26,446,9343.9%
6. Lincoln National Corp.$25,804,5653.8%
7. Principal Financial Group Inc.$25,322,7743.7%
8. AXA$22,579,4313.3%
9. Transamerica$22,352,4183.3%
10. Jackson National Life Group$21,511,5573.2%

Individual Life Insurance – Top 10 writers by direct premiums written in 2018

In 2018 the top 10 companies wrote roughly $58 million of life insurance and annuity premiums.

CompanyDirect premiums writtenMarket share
1. Northwestern Mutual Life Insurance Co.$10,547,4698.2%
2. Lincoln National Corp.$7,467,8695.8%
3. New York Life Insurance Group$7,331,0155.7%
4. Massachusetts Mutual Life Insurance Co.$6,171,2134.8%
5. Prudential Financial Inc.$5,806,1184.5%
6. John Hancock Life Insurance Co.$4,651,8943.6%
7. State Farm Mutual Automobile Insurance$4,593,9993.6%
8. Transamerica$4,567,9993.6%
9. Pacific Life$3,770,5842.9%
10. MetLife Inc.$3,724,1652.9%

Individual Life Insurance – Top 10 writers by direct premiums written in 2018

In 2018 the top 10 companies wrote around $20 million of life insurance and annuity premiums.

CompanyDirect premiums writtenMarket share
1. MetLife Inc$7,133,71821.0%
2. Prudential Financial Inc.$3,364,7659.9%
3. Securian Financial Group$2,510,1577.4%
4. New York Life Insurance Group$2,054,8286.1%
5. Cigna Corp.$1,703,2275.0%
6. Unum Group$1,617,9004.8%
7. Lincoln National Corp.$1,357,4114.0%
8. Hartford Life & Accident Insurance Co.$1,334,4633.9%
9. Nationwide Mutual Group$1,315,2673.9%
10. CVS Health Corp.$946,2262.8%

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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About Brian Greenberg

Brian is the CEO and Founder of True Blue Life Insurance. Brian is licensed to sell life, health, annuities, and property and casualty insurance in all 50 U.S. states. He is the author of The Salesman Who Doesn't Sell and is a member of the Million Dollar Round Table, an organization that consists of the top 1% of financial advisors worldwide.

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