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By the MIB Life Index – February 3, 2021 Despite a tumultuous year due to the pandemic, the MIB Life Index ended 2020 up 4% year-over-year, representing the highest Y-o-Y annual growth rate on record. It surpassed the previous Y-o-Y growth record from 2015 of +2.7%, and followed a fairly flat growth year in 2019, which concluded up 0.4%, Y-o-Y. The 2020 year-end index value of 102.8 is an all-time high since the index was reset in 2011, finishing at 2.8% higher than par value.
The MIB Life Insurance Index is changing the way it reports trends in application activity, moving away from showing figures relative to an index in favor of reporting straight year-over-year percentages. MIB says its new approach is more straightforward, easier to understand and more useful than the index values. Source: https://www.mibgroup.com/riskanalytics/lifeindex.html  |
Life insurance statistics in 2020
Stats to help you understand life insurance — who has it and how much it costs.
Life insurance by the numbers
57% • Percent of American adults who have life insurance
32% • Of American adults with life insurance, the percent who only have group coverage — which usually isn’t enough (and is rarely portable)
10x to 12x • The multiples of your annual income that most financial advisors recommend you need when buying life insurance for income replacement
50% • Percent of life insurance policies are purchased via independent agents
40% • Percent of life insurance policies purchased via captive agents (meaning they only sell products for one insurance company)|
Stats about the cost of life insurance
6x-10x • How much more permanent life insurance (like whole life insurance) costs vs. term life insurance
8% * Average percent increase in your insurance costs as you age, assuming your health stays the same
30% • The average cost difference between sequential health ratings (preferred vs standard, for example)
2x to 3x • How much rates for smokers cost vs. rates for nonsmokers (but a year after you quit smoking, most companies will offer you nonsmoker rates)
50% • The average difference between the least expensive and most expensive rate for the same person across insurance companies
30% • Percent difference between premiums for men and women(with women paying nearly ⅓ less than men, on average)
Sources:
Policygenius data, 2019 Insurance Barometer Study, Life Happens and LIMRA
Top reasons for buying life insurance in the U.S.
According to a 2019 report from trade research organization LIMRA and the non-profit organization Life Happens, these are the most common reasons Americans said they bought life insurance:
- 37% Income replacement
- 30% Burial/final expenses
- 28% Wealth transfer
- 27% Pay off mortgage
- 19% Replaced a policy
- 17% Tax advantaged save/invest
- 14% Estate taxes/liquidity
- 14% Funds for college education
- 13% Charitable gift
- 8% Supplement group coverage
- 8% Business purposes
Read the full article here.
