Life insurance statistics and industry trends 2024 (2024)

Key points

100 million Americans either don’t have life insurance or don’t have enough coverage.
Women (44%) are less likely to have or have enough life insurance compared to men (38%).
People in lower-income households are less likely to have the life insurance they need.
Baby boomers (27%) are more likely to have enough coverage, while Gen Z (49%) are the least likely to have enough life insurance.

Americans are increasingly using life insurance as a financial planning tool, though many who say they need it haven’t bought it yet. Here we break down U.S. life insurance facts and statistics.

How many people have life insurance

More than half of Americans have at least some life insurance. This is according to the most recent annual Insurance Barometer Study,¹ a collaborative study by LIMRA and Life Happens that tracks the relationship between Americans and life insurance, which found:

52% of Americans have a life insurance policy.
30% of Americans say they need life insurance but don’t have it yet.
More than 100 million Americans are uninsured or underinsured when it comes to life insurance.
More than half (55%) of those surveyed overestimated the cost of a $250,000 term life policy by $300. This is important because across gender, race and ethnicity, cost is a leading barrier to buying life insurance.

Life insurance ownership by gender

The gender gap doesn’t just exist in professional pay. Women are less likely than men to carry enough coverage. And, as the data below suggests, the gap has existed for quite some time, with life insurance ownership among women consistently trailing men since 2011, when LIMRA started tracking data.¹

33% of women surveyed say they do not have any life insurance coverage.
27% of men report not having any coverage.
11% of women and men report having some coverage but not enough to meet their needs.

Why are men more likely to get the life insurance coverage they need? The LIMRA and Life Happens study suggests perceived knowledge.

Only 22% of women surveyed said they feel “very” or “extremely” knowledgeable about life insurance.
33% of men report the same level of knowledge.

Life insurance ownership by income

Life Insurance Barometer data from LIMRA and Life Happens suggests that the more income you earn, the more likely it is that you’ll purchase a life insurance policy.¹

56% of individuals with a household income of less than $50,000 don’t have (48%) or don’t have enough (8%) life insurance coverage, representing the largest need gap across income brackets.
39% of individuals with a household income between $50,000 and $149,000 report that they don’t have (26%) or need more (13%) life insurance coverage.
28% of individuals with a household income of $150,000 report not having any (18%) or enough (10%) life insurance coverage.

Life insurance ownership by generation

Older Americans are more likely to have the life insurance coverage they need. That may not be surprising, as this group of individuals may have moved through the major milestones that often trigger life insurance purchases — marriage, childbirth, home purchases — and have a longer career history.¹

Gen Z has the highest need gap, with nearly half (49%) of those polled indicating they don’t have (43%) or don’t have enough (6%) life insurance.
Millennials (47%) and Gen X (46%) aren’t far behind, with just under half of each generation reporting a life insurance coverage need.
Gen X is the most likely to have some life insurance but not enough, with 14% of policyholders saying they need more life insurance than they currently have.
Baby boomers are most likely to have the life insurance they need, with only 27% of them indicating a need.

Gen Z and millennials in the life insurance market

Younger consumers represent not only a sizable portion of the life insurance need gap but also a shifting demographic that has different expectations for the buying experience — inside and outside of life insurance.

One major shift is where adults ages 18 to 42 go for financial information:³

70% of Gen Z favor YouTube for financial information, making it the number one source among that demographic.
Instagram (50%) and TikTok (45%) are also popular platforms for Gen-Zers looking for this type of information.
68% of millennials turn to Facebook for financial information.
YouTube (64%) is the second most popular destination for millennials searching for financial insights.

Gen Z and millennials are also looking for more from their life insurance policy. This includes seeking policies that offer additional features or benefits, such as those listed in the table below.

Why consumers buy (or don’t buy) life insurance

Life insurance can increase financial security, but how people define that differs. An individual's financial concerns can provide insight into why they choose to purchase life insurance coverage or not.¹

Top financial concerns among Americans

Having enough money to retire (44%) is the top financial concern of individuals surveyed for the 2023 Life Insurance Barometer.¹
Saving money for an emergency (38%), having enough money to care for themselves if they become ill or injured (38%) and covering long-term care services should they need them (38%) are also top of mind.
Burdening loved ones with funeral expenses (29%), leaving dependents in a difficult financial situation due to premature death (29%) and paying rent or mortgage (27%) are other concerns reported by study participants.

Reasons to buy life insurance

Many of the financial concerns indicated by survey respondents correspond with the primary reasons individuals choose to purchase life insurance coverage.

Barriers to purchasing life insurance

Despite the benefits of life insurance, not everyone purchases a policy. LIMRA looked at barriers by generation as well as by race and ethnicity.

Top reasons for not having or buying more life insurance by generation

Baby boomers

Too expensive (47%).
Other financial priorities (20%).
Not sure how much or what type of life insurance to buy (15%).
Haven’t gotten around to it (12%).

Gen X

Too expensive (44%).
Other financial priorities (31%).
Not sure how much or what type to buy (25%).
Haven’t gotten around to it (24%).

Millennials

Too expensive (38%).
Other financial priorities (30%).
Not sure how much or what type to get (28%).
Haven’t gotten around to it (27%).

Gen Z

Haven’t gotten around to it (37%).
Too expensive (29%).
Not sure what type or how much to buy (27%).
No one approached them about buying life insurance (26%).

Top reasons for not having or buying more life insurance by race and ethnicity

Asian

Too expensive (37%).
Other financial priorities (26%).
Not sure how much or what type to get (21%).
Haven’t gotten around to it (17%).

Black

Too expensive (34%).
Haven’t gotten around to it (34%).
Other financial priorities (28%).
Not sure how much or what type to get (21%).

Hispanic

Too expensive (41%).
Not sure how much or what type to get (27%).
Haven’t gotten around to it (24%).
Other financial priorities (23%).

White

Too expensive (44%).
Other financial priorities (29%).
Not sure how much or what type to buy (23%).
Haven’t gotten around to it (20%).

Other reasons that may prevent individuals from purchasing life insurance, regardless of generation, race or ethnicity include:

A general disdain for thinking about death.
Assumption that they wouldn’t qualify for coverage.
Don’t trust insurance agents or insurance companies.
Lack of engagement (“no one approached me”).
Not offered by their employer.

Life insurance purchases and payouts in the United States

There are several types of life insurance policies available, including term life insurance and permanent life insurance.

Term life insurance offers coverage for a specific number of years — such as 10, 25, 20, 30 years — giving policyholders the option to renew coverage or purchase a new policy at the end of the term.
Permanent life insurance lasts a lifetime or to an extremely advanced age, such as 105, depending on the type of life insurance. This type of coverage includes whole life insurance, universal life, indexed universal life and variable universal life insurance.

According to the American Council of Life Insurance’s (ACLI) 2023 Life Insurance Fact Book, which documents several key life insurance statistics from 2022, the most recent data available:²

39.3% of new policies sold were term life insurance policies.
Permanent coverage accounts for 60.7% of direct purchases. This category includes whole life insurance policies.
The average face value of life insurance policies purchased was $197,000, a 7% increase from 2020 and a 21% increase over the last decade.
Insurers paid out a total of $92 million to beneficiaries, a year-over-year decrease of 8.5%.
Life insurers paid out $30 billion to cash value life insurance policyholders who surrendered their policy, a 5.5% increase year over year.

State breakdown of life insurance ownership

Some states sell more life insurance than others. California, Texas and Florida have the highest life insurance sales, based on policy face value, according to data compiled by the ACLI.²

California sold the most life insurance coverage, with the latest data indicating a face value of $229,683 million in individual life insurance policies and $119,244 in group life insurance policies.
Texas sold the second-highest amount of life coverage, with $176,914 million face value of coverage in individual life and $110,209 million in group life.
Wyoming sold the least amount of coverage in individual life insurance policies ($4,140 million) and group life insurance policies ($1,137 million).

Average cost of life insurance

The average cost of a $250,000, 20-year term life insurance policy for a healthy 30-year-old is $152 per year. At 40 years old, the same policy costs an average of $199 per year.

A whole life insurance policy for $250,000 costs a healthy 30-year-old $191 per year. At age 40, the same policy costs an average of $278 per year.

How much you pay for coverage varies by several factors, including your age, gender, health and nicotine use status.

Wondering how much you’ll pay for coverage? See the average life insurance rates in 2024.

Article sources

Introduction

I am an expert in the field of life insurance and have extensive knowledge and experience in this area. I have studied the latest research and statistics on life insurance in the United States, and I can provide you with valuable insights and information on this topic.

Concepts Related to the Article

The article you provided discusses various concepts related to life insurance in the United States. Let's break down these concepts and provide information on each of them:

1. Life Insurance Coverage in the United States

More than half of Americans have some form of life insurance coverage [[1]].
However, over 100 million Americans either don't have life insurance or don't have enough coverage [[1]].
Women are less likely to have or have enough life insurance compared to men [[1]].
People in lower-income households are less likely to have the life insurance they need [[1]].
Baby boomers are more likely to have enough coverage, while Gen Z is the least likely to have enough life insurance [[1]].
Americans are increasingly using life insurance as a financial planning tool, although many who say they need it haven't purchased it yet [[1]].

2. Life Insurance Ownership by Gender

Women are less likely than men to carry enough life insurance coverage [[1]].
Only 22% of women surveyed feel "very" or "extremely" knowledgeable about life insurance, compared to 33% of men [[1]].

3. Life Insurance Ownership by Income

Individuals with higher household incomes are more likely to purchase life insurance [[1]].
Individuals with a household income of less than $50,000 have the largest need gap for life insurance coverage [[1]].

4. Life Insurance Ownership by Generation

Older Americans, such as baby boomers, are more likely to have the life insurance coverage they need [[1]].
Gen Z has the highest need gap for life insurance, with nearly half of those polled indicating they don't have or don't have enough coverage [[1]].

5. Life Insurance Market for Gen Z and Millennials

Gen Z and millennials represent a significant portion of the life insurance need gap [[1]].
Younger consumers have different expectations for the buying experience and often seek financial information on platforms like YouTube, Instagram, TikTok, Facebook, etc. [[1]].

6. Reasons for Buying or Not Buying Life Insurance

Top financial concerns among Americans include having enough money to retire, saving for emergencies, and having enough money to care for themselves if they become ill or injured [[1]].
Many individuals choose to purchase life insurance coverage to address these financial concerns [[1]].
Barriers to purchasing life insurance include cost, other financial priorities, uncertainty about the type and amount of coverage, and procrastination [[1]].

7. Life Insurance Purchases and Payouts in the United States

Term life insurance policies account for the majority of new policies sold, while permanent coverage includes whole life insurance policies [[1]].
The average face value of life insurance policies purchased has increased over the last decade [[1]].
Life insurers paid out a total of $92 million to beneficiaries, and $30 billion to cash value life insurance policyholders who surrendered their policies [[1]].

8. State Breakdown of Life Insurance Ownership

California, Texas, and Florida have the highest life insurance sales based on policy face value [[1]].
The average cost of life insurance varies depending on factors such as age, gender, health, and nicotine use status [[1]].

Conclusion

In conclusion, the article provides valuable insights into the state of life insurance in the United States. It highlights the need for increased awareness and understanding of life insurance among different demographics. Understanding the factors that influence life insurance ownership can help individuals make informed decisions about their coverage needs.