Even as their life expectancy continues to exceed that of men, women's life insurance ownership rate lags behind their male counterparts.
The 2021 Life Insurance Barometer study found that women's life insurance ownership rate has dropped 10 points, to just 47%. Not only that, just 31% of women said they would probably buy coverage in 2021 (42% of men said they would).
The numbers go the other way when it comes to life expectancy. According to 2020 census data, women's life expectancy is 80.5 — compared to 75.1 for men.
Women have greater needs when it comes to insurance, but are more likely to be under-insured. These two opposing trends are creating a gender gap. In fact, in 2022, 44% of women believe they have a life insurance gap.
When you talk to your female clients, whether they are single or part of a couple, it's important to learn their unique life insurance and estate planning needs. Here are five questions to ask to get the conversation going.
1. If you don't have life insurance, why not?
LIMRA asked this question and found something interesting: Women don't buy life insurance because they often feel confused about it. Whereas almost 40% of men said they felt knowledgeable about life insurance, only 22% of women said the same. Learning why your female clients don't have life insurance can offer a great way in to a larger conversation.
2. What are your fears about life insurance?
That lack of knowledge — or perceived lack of knowledge — about life insurance can lead to fear. The only way to dispel these fears is to have an honest conversation.
When it comes to buying life insurance, women can feel undermined, which causes even more uncertainty. They may have anxiety that they will be treated differently, belittled or taken advantage of. They may also believe that life insurance is outside of their budget. In fact, eight in 10 women believe life insurance to be more expensive than it is.
3. What is your retirement savings plan?
This is another area where the gender gap exists. According to Census data, half of women ages 55 to 66 have no personal retirement savings. Only 22% have $100,000 or more in personal retirement savings, compared to 30% of men. There are many reasons for this gap, including the fact that women, on average, are still paid less than men.
This is why it's doubly important for women to feel knowledgeable about how retirement savings work and to have a clear view of how much they will need to not only retire but to pay for their final expenses. Talking about savings goals is a good way to open up the conversation.
4. Are you now or do you anticipate being a caregiver to children, a partner or elderly parents?
According to the Family Caregiver Alliance, about 66% of all caregivers are women, with the average being a 49-year-old woman who works and also provides 20 hours of unpaid care. In fact, 20% of all female workers are caregivers.
Women may reduce working hours, take leaves of absence, pass up promotions, quit altogether or retire early because of their caregiving duties. Because of this, there are often more financial ramifications for women than men. A woman who is a caregiver may see a loss of more than $300,000, in terms of lost wages and Social Security benefits.
It's good to bring up the role caregiving is currently playing, or may play in the future, so your female clients can plan accordingly.
5. Do you have a will?
More women than men said they were worried they would leave their families in a tough financial situation if they were to die. In fact, 43% of women said this, five percentage points more than men, according to the 2021 Insurance Barometer survey. Women are earning less, more likely to be a caregiver (which further cuts into their earnings), and less likely to have retirement savings — and on top of this, they have financial responsibilities to their families.
The discussion about having a will can be a stressful one. No one wants to think about their mortality. But it's another approach to the conversation about life insurance. It's a good chance to ask your female clients what they want in place for their loved ones, as they think about what's in place for their own financial futures.
These five questions can help you start the conversation with female clients about life insurance. As an insurance professional, having these conversations is just one way you can help close the life insurance gap.