American women have made major strides in the labour market
where they now account for half of the workforce in the US. Despite
this, women remain under-served by life insurers and lag men in
their understanding of benefits offered by life insurance in areas
such as income protection. Charles Davis
A trio of recent studies underscores the promise that women
hold for the life insurance market in the US and show clearly the
potential for gender equity to transform the business.
Women have made gains in the job market, now holding half of the
132 million jobs in the US, according to recent data from the US
Bureau of Labor Statistics (USBLS). However, a gap remains in their
understanding and use of benefits that protect their income,
reveals research by The Hartford Financial Services Group.
Men have higher participation rates for income protection benefits,
such as life and disability insurance, while women have higher
participation in health benefits, including medical and dental
coverage, according to The Hartford. In a national survey, The
Hartford found 64 percent of women wage earners “completely or
mostly” understand life insurance compared with 79 percent of men.
And 61 percent of women workers said they have life insurance
through their employer, compared to 68 percent of men.
“Women are making important contributions to the US economy and to
their family finances,” said Laura Marzi, assistant vice-president
of marketing in The Hartford’s Group Benefits Division, in a
“We are concerned about the number of women who still lag behind
men in protecting their wages. We are encouraging all workers,
particularly working women, to take steps to protect their physical
and financial health.”
Women faring better
Women are where the money is these days in the US. Men have
suffered the most job losses in the past year, and women have
outpaced men in getting jobs in the sectors that are growing, such
as health care and education, according to the USBLS.
However, 32 percent surveyed by The Hartford said they are just
meeting their expenses or do not have enough income to meet their
expenses, compared to 19 percent of men. The survey also found that
97 percent of all workers would have to change their lifestyle to
meet expenses if they lost part of their family’s income for three
to six months.
Sixty-eight percent of women surveyed by The Hartford said they are
the primary decision maker in their household. Many said they turn
to their family for advice when considering life insurance. Spouses
and immediate family members were the top influencer (62 percent)
among female survey participants.
A third of women said it is extremely important to discuss
end-of-life issues, such as life insurance, with family members,
according to The Hartford’s survey. Yet, the survey data indicated
men are more comfortable than women discussing these issues. And
only 28 percent of women reported having a will, compared to 42
percent of men, according to The Hartford.
Axa Equitable Life Insurance recently conducted a similar study
which showed women are placing significantly more importance on
retirement concerns and the ability to pay everyday expenses than
they did before the economic crisis. Since the crisis hit, more
than three in four women polled (77 percent) say they worry more
now about being able to make ends meet, up 16 percentage points
from a similar poll conducted in April 2008.
Since October 2008, about 85 percent of women surveyed say that
having a guaranteed source of retirement income for life is highly
important – up from 72 percent in April 2008. The Axa study also
found that, though more preoccupied with financial matters, women
are not taking the long-term action necessary to achieve their
goals. Specifically, less than half of women surveyed (41 percent)
reported having a primary financial professional, down 18
percentage points from last April.
Women have also reduced the number of investment products they own.
Since April 2008, the number of stocks, mutual funds, IRAs and
annuities owned by women has dropped about 10 percentage
“Women are clearly more focused on their finances and, although
that may be due to market conditions of the past 18 months, it is a
step in the right direction,” said Barbara Goodstein, executive
vice-president and chief innovation officer for Axa Equitable, in a
statement. “What is disconcerting, though, is that they are going
without the guidance of a trusted financial professional, and are
forsaking their long-term financial strategies for short-term moves
that may be manifested in panic.”
The study did contain some bright spots for insurers. Women closer
to retirement age or in retirement are most likely to consult with
a financial professional. Almost half (47 percent) of women aged 55
and older have a primary financial professional, while 64 percent
of retired women are likely to have a financial professional. More
than 7 in 10 (71 percent) women with financial professionals
consider preserving assets for retirement significantly more
important, compared to just 60 percent of women without financial
Another study, conducted on behalf of the Penn Mutual Life
Insurance Co, revealed that while women value the ‘living benefits’
of life insurance, primarily the ability to access cash, they are
largely unaware these benefits exist.
The survey shows women associate life insurance with death
benefits. Upon hearing the phrase ‘life insurance’, most women (60
percent), on an unaided basis, think of some type of death benefit.
For example, 34 percent of women mentioned
Even on an aided basis, women appear to be predominantly unfamiliar
with all of the living benefits of life insurance. Even women who
own permanent life insurance, which offers such living benefits,
are not any more likely to be familiar with these.
According to the survey, the living benefits resonate most among
women. Benefits such as an income stream during retirement; access
to money for things they want to do; and access to cash should it
be needed are clearly regarded as very important to women. These
three benefits exhibit higher levels of importance than do the
death benefits with which they are more likely to be
The distinct gap between importance and awareness indicates that
life insurers are missing a real opportunity when it comes to
speaking with women about life insurance. Given the gender
revolution sweeping US workplaces, it’s past time for insurers to
begin closing the gap.