28 March 2014 0 Comments

A woman’s need for life insurance

shutterstock_109429289According to recent research, women make up 49% of the workforce and 4 in 10 American households with children under age 18 now include a mother who is either the sole or primary earner for her family.  Yet only 43% of working women have life insurance and their average policy is only about $130,000.  That may seem like a lot, but when you figure that most financial advisors recommend life insurance coverage equal to 7 to 10 times annual income, that amount is pretty small.

A recent double page ad I saw in a women’s magazine placed by a large life insurance company said it all:  The photo of a concerned looking 40sh women with the caption, “Will my family be taken care of?  Will the anxiety about taking care of my family be taken care of?”

Throughout my blogs I’ve touted low cost term insurance as a way for family breadwinners to replace income for their families and I’ve typically used male premiums as an example.  Unfortunately that’s quite typical of how many agents think, but thank goodness there are more female agents now then when I first started selling, so hopefully more women are being made aware of just how important and affordable life insurance protection can be for their families.  And—because a woman’s life expectancy is better than a man’s—their premiums are even more affordable.  The monthly premium with one company for $500,000 of 20 year term for a 40 year old woman who is a non-smoker, preferred-best risk is only $26.42, while a man at the same age  in the same underwriting class is $30.25.

This female advantage is not available in all states.  Montana does not allow the use of gender to determine the correct life insurance premium to be charged.  This was the work of a Woman’s Rights advocacy group, who I believe got their agenda all wrong.  Since life insurance is not a mandatory type of protection, the insurance companies should be able to use appropriate pricing factors based on actual mortality experience.  But, there may be some other misguided advocates out there, so I urge women to take advantage of the current price break now.

Next… I’ll sound off on some misguided financial hysteria often promulgated by the media and where life insurance fits in.

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