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Pandemic Scare Increases Interest in Life Insurance
Just as the COVID-19 pandemic convinced consumers they need health insurance and more generous retirement benefits, applications for life insurance recently had record-breaking growth. The Medical Information Bureau (MIB) reports that life insurance application activity this spring was up year over year (YOY) more than 10 percent.
Some observers believe that many people faced the reality of their own mortality during the pandemic and realized they needed to protect their dependents’ financial security. It also helped that the proliferation of online applications has made it easier for individuals to get coverage without having to leave home.
In addition, a revision to the federal tax code is making it easier for permanent life insurance policy holders to contribute more money to their cash-value accounts.
While all age groups bought more coverage than in the past, people 71 years and older had the highest YOY gain in spring 2021, which reversed a 12-month trend where this age group previously had the lowest YOY activity.
Of all of the different types of life insurance, Term Life saw a slight decline of almost 2 percent. In comparison, Universal Life and Whole Life saw double digit increases.
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