In Life Insurance for Women

I recently read a marketing piece from one of the insurance companies that we represent that hit on a sales idea built around women.  I thought that I would share some of the data, I thought it was very interesting.

When it comes to life insurance, women as a group are largely underinsured.  In fact the company data provided indicates that in 2011 only 25% of face amount sold was on women.

I found that last part to be very surprising.  Whether a woman works inside or outside the home, the value of her contribution cannot be underestimated. In fact in 2011, a survey of over 6,500 mothers by put some equivalent salaries to tasks performed and concluded that the annual salary of a stay-at-home mother would be $115,432.  For a mother working a full time job, the afterhours work done at home would earn them an additional $63,472 on top of their full time salary.

These numbers may seem high until you start breaking down all of the services that would need to be hired out in the event that something happened to mom.  How much would it actually cost to hire a chef, a personal shopper, a chauffeur for the kids, daycare for the kids, etc….it all adds up.

In married families, more often than not the application process that I see goes like this, whether mom or dad is the primary income producer, the larger amount of life insurance is placed on primary wage earner and a much smaller amount of life insurance, if any at all, is placed on the spouse.  Most carriers will allow a like amount, up to $1mm, on a non-working spouse.

It’s time to re-evaluate the needs analysis process for covering the working family.

$1,000,000 of coverage on “Dad” and $50,000 of coverage on “Mom” flat out doesn’t make sense.

To discuss this topic more, please contact MichiganTerm.