Younger adults lead the way as interest in purchasing life insurance reaches all-time high

Although the stock market has been on a roller coaster ride, the life insurance industry is enjoying a bull market.

A record-high 39% of consumers plan to purchase life insurance within the next year, the 2023 Insurance Barometer Study from LIMRA and Life Happens found. The intent to buy is even higher among Gen Z adults (44%) and millennials (50%).

“Younger generations experienced a life-altering event just as they were starting their careers, getting married and having children,” says Alison Salka, Ph.D., senior vice president and head of LIMRA research. “The realization of how precarious life can be may have made them more aware of the need to protect their loved ones.”

This year’s study looked at the growing single mothers market and found that less than half said they have life insurance, 11 points below the general population rate. Because single mothers often are the sole source of financial support for their children and typically have a heightened sense of financial concern, it is not surprising that their need for life insurance is higher. Fifty-nine percent of single mothers said they need life insurance coverage or more of it, representing five million adults.

Parents of minor children were more likely than the general population to own life insurance (59% vs. 52%), and they also were more likely to acknowledge they didn’t have enough coverage (47% vs. 41%). Among younger parents, the need gap was greater. On average, 56% of Gen Z and millennial parents reported not having enough coverage.

Lack of knowledge about life insurance appears to be the greatest obstacle preventing younger parents from getting coverage. Fewer than one-third of Gen Z and millennial parents feel very knowledgeable about life insurance. Moreover, 40% of Gen Z parents and 29% of millennial parents said they haven’t purchased coverage because they don’t know how much they need or what type to buy.

“Educating young adults is key, because no one is going to buy what they don’t understand,” says Maggie Leyes, chief creative officer for Life Happens. “Year after year, people significantly overestimate the cost of life insurance while citing expense as the top reason for not getting coverage.”

Read more: Workplace life insurance and the lifecycle of needs

The way that young adults are engaged also is important.

“Younger adults are increasingly looking to buy life insurance online and are more likely to use social media platforms — particularly Instagram, Twitter and TikTok — to educate themselves,” she says. “Our goal should always be to meet them where they are.”