Genworth Financial Study Unveils Significant Life Insurance Coverage Gap; Launches New Life Insurance Consumer Website, Tools in Response
Too many Americans who need life insurance coverage are uninsured, putting their families and futures at risk. According to the 2011 Genworth Financial LifeJacket(SM) Study released today, single parents across all income levels with children living at home represent the widest insurance gap, potentially leaving their children with few or no options when faced with an unexpected death.
The research project, developed in collaboration with Gregory B. Fairchild, Associate Professor at the University of Virginia, Darden School of Business, found that 69% of single parents with children living in the household constitute the highest percentage of uninsured Americans compared to married parents with children in the household (45%) and single parents with children in or outside the household (59%).
"We were surprised to find that single parents – the group arguably the most in need of life insurance – are among the highest uninsured people in the U.S.," said Gregory Bucko, Director of Customer Innovation at Genworth Financial companies. "It's a common misconception that life insurance is always expensive or something you need to purchase all at one time. Life insurance should be thought of as a journey, as something that can be obtained in increments as life needs evolve. Even small increases in a person's life insurance coverage over time can mean the difference between financial independence and financial hardship for their loved ones in the event of a death."
Only 49% of the U.S. adult population has some type of life insurance coverage. Single people, regardless of whether or not they have children, are 36% below the national level for life insurance coverage, according to the study.
Men and Women are Not Insured Equally
According to the survey, single male parents with children living in the household are more uninsured than single females at every income level. In fact:
- 79% of unmarried men who are not homeowners, having children in the household and earning an income of less than $50,000 per year are uninsured compared to 66% of women in the same category.
- The percentages do not drop dramatically as income increases. In fact, 79% of unmarried men who are not homeowners having children in the household making between $50,000-250,000 per year are uninsured.
- More than half (56%) of unmarried women who are not homeowners having children in the household but making more than $250,000 are uninsured.
"We find that many single parents are simply too busy – or even too scared – to properly evaluate their life insurance needs," said Fairchild, who also serves as Executive Director of the Tayloe Murphy Center at the Darden School of Business. "This is an understandable fear because the first level of financial safety – the other parent – isn't there. The study revealed the severity of this situation, not just among single parents, but married ones, too. The insurance industry has an opportunity to better educate consumers and give them the tools and resources to help protect themselves and their families."
The level of uninsured households tends to increase as the number of children increases, particularly at the lower income levels. The percentage drastically increases in instances of five or more children.
Tools to Change the Trends
To help consumers better understand how much coverage they really need and demystify the purchase process, Genworth has introduced a new program called The LifeJacket(SM) Project
. The effort is designed to better understand and educate consumers about life insurance and bring them together with financial professionals to help them close their individual coverage gap. Genworth has introduced new tools to help consumers understand the risks associated with not having life insurance as well as how affordable it can be. To view the tools, please visit the following link: www.genworth.com/life
- Life Insurance Calculator Genworth has created an innovative and simple way to help consumers think about their life insurance needs. Rather than asking a series of personal questions and returning a recommended amount, Genworth's tool asks consumers what they want life insurance to help protect and shows an estimated cost for that coverage. "This empowers consumers to take ownership in the life insurance process and helps them think about their needs," Bucko said.
- Budget Calculator Genworth's innovative budget calculator helps demonstrate how just small changes, such as bringing a lunch to work once a week, can expand your life insurance budget significantly.
"Life insurance doesn't have to be complicated or stressful," added Bucko. "Closing your personal coverage gap can be done by taking three simple steps. One, think about your current life insurance needs. Two, talk to a financial professional about those needs. Three, repeat steps one and two annually. If people start to think about life insurance as a journey, they'll be better able to help protect their families and their futures."
About Genworth's 2011 LifeJacket Study
The LifeJacket Study of the uninsured in America was conducted in collaboration with a independent third party research firm, Ruf Strategic Solutions. The supporting survey data for this longitudinal, multi-modal study was collected over the course of 15 months via modes including telephone, online and mail. More than 23,000 adults (ages 18+) across the United States were surveyed providing a highly stable and reliable data source. This allowed for estimates of the percent of uninsured U.S. adult population within +/- 5% with 95% confidence. Genworth developed a life insurance coverage gap snapshot for the full U.S. adult population as well as one for a subset defined as "Main Street" (household income between $50,000 and $250,000).
About Genworth Financial
Genworth Financial, Inc. (NYSE: GNW) is a leading Fortune 500 global financial security company. Genworth Financial employs approximately 6,500 people with a presence in more than 25 countries. Its products and services help meet the investment, protection, retirement and lifestyle needs of more than 15 million customers. Genworth Financial operates through three segments: Retirement and Protection, International and U.S. Mortgage Insurance. Its products and services are offered through financial intermediaries, advisors, independent distributors and sales specialists. Genworth Financial, which traces its roots back to 1871, became a public company in 2004 and is headquartered in Richmond, Virginia. For more information, visit Genworth.com. From time to time Genworth Financial releases important information via postings on its corporate website. Accordingly, investors and other interested parties are encouraged to enroll to receive automatic email alerts and Really Simple Syndication (RSS) feeds regarding new postings. Enrollment information is found under the "Investors" section of Genworth.com.
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