Why Do 70% of Millennials Buy Life Insurance?
Millennials get blamed for a lot of things, like the bankruptcy of their parents’ favorite chain restaurant and their go-to department store. But 20-somethings and 30-somethings aren’t destroying industries, they’re improving them.
When it comes to shopping, consumers have forced companies to change, or else risk the same fate as Blockbuster. Even life insurance, a centuries-old industry, has been forced to adapt to meet the needs of their customers. Fortunately, this means that life insurance is more attainable than ever before.
According to a study by LIMRA, 70% of millennials have life insurance coverage. So why have millennials made life insurance a financial priority?
1. Affordable Rates
Many people think that life insurance coverage is too expensive, but that really depends on what you need out of a policy. If you want simple coverage with a locked-in rate, term life insurance is the way to go. Millennials are buying policies for as little as $3 per month.
Term life insurance has become a popular pick for those who want more for less. It’s super easy, too. Just choose a term (usually 10 or 20 years), the amount of coverage you want ($50,000 to $1 million), then pay your monthly premium until your term ends. If you pass away during your term, your beneficiaries would receive the death benefit tax-free.
How much coverage you buy is up to you. More coverage means a more expensive policy, as does a longer term. But the younger you are, the less you’ll pay, so millennials are taking advantage of locking in a low monthly rate.
2. No Medical Exam
Until very recently, buying life insurance was a very tedious underwriting process that took weeks — sometimes months — to buy. Paperwork, interviews, medical exams, lab work, physician’s statements… and sometimes even more just to find out if you can get coverage and at what rate.
Digital disruptors, like Bestow, are using data and technology in their underwriting instead. A simple online questionnaire is all that is needed in order to complete the application. If approved, just buy it and get covered instantly. This technology has made it possible for introverted millennials to get coverage without undergoing the invasive application process that traditional life insurance companies still use.
3. Coverage in as Little as 10 Minutes
As mentioned above, digital disruptors have simplified the life insurance application process. In fact, it’s so simple, you can apply for coverage from your phone and have up to $1 million in term life coverage in just a few minutes.
The data and proprietary technology, also called accelerated underwriting, works behind the scenes as questions are answered in the application. The process is as fast as you can read, but it isn’t a competition about how fast you can buy coverage. What’s important is that this technology has made it possible for people on the go, like millennial parents, to get a policy when they’re strapped for time.
The life insurance death benefit can be used to pay for anything — funeral costs, college tuition, mortgage, cost of living, and so forth. And in just a few minutes, you can buy coverage for your loved ones that can take care of them for years after you’re gone.
Millennials Have Great Financial Sense
Millennials may have a bad rap, but they’re prioritizing their finances and their family’s financial futures. As a result, financial services industries, like life insurance, are making improvements that benefit us all.