A common mistake regarding life insurance for women is underestimating their worth. As women have become increasingly dominant players in the workforce, only 47% of women have life insurance, 11% less than men.
Gender plays an important role and it is important to understand how gender affects not only one’s personal physical well-being, but can also affect a family’s financial well-being. Many people are aware of the gender pay gap, with women earning on average 82 cents to every dollar earned by men. However, another troubling financial reality is the life insurance gender gap. Initial findings from the 2021 Insurance Barometer Study, by Life Happens and LIMRA, show that just 47% of women have life insurance, versus 58% of men.
There are multiple reasons behind the life insurance gender gap.
● Women’s lower earnings lead to less coverage. Life insurance coverage limits are often a multiple of your annual earnings. According to the Bureau of Labor Statistics, men earn an average of $55,744 while women earn an average of $46,488. Using a common multiplier of 10 (with 10 times your salary being a general rule for how much life insurance you need) would mean the average woman could end up with $925,600 less coverage than an average man.
● Women’s unpaid labor is under valued. More than one in four mothers stays at home with her children, while others work reduced schedules to accommodate the needs of their families. These women may not earn large paychecks (or any paycheck at all), however the value of their unpaid labor is immense. Estimates show that the value of childcare, housekeeping and more that stay at home mom’s provide to be worth over $178,000 a year. Further compounding the issue is the fact that many get their life insurance through their work. While life insurance from an employer is almost never enough, it is an important starting point for many families. However, life insurance through a job usually only covers the worker.
● Women lack financial literacy. A study by FINRA revealed that women answered only 48% of financial literacy test questions correctly, while men answered 58% correctly. A lack of confidence in their financial know-how may keep many women from getting the life insurance they need.
So how do we close the life insurance gender gap? There is a growing awareness about the significant contributions women make toward the care of their families. If one had to replace this unpaid labor, it would be very expensive which makes life insurance for women a necessity. Women can help close the life insurance gender gap by taking stock of their life insurance needs, exploring life insurance basics, and talking to a professional about coverage. Read about how investing in life insurance is more than just getting a quote and clicking Buy Now on our website https://www.termprovider.com/mythicalrates.