New Lincoln Financial research confirms gap in understanding the value of life insurance

While most consumers are familiar with a death benefit, the majority don't realize life insurance can support other financial goals

Radnor, Pa., November 1, 2024

New research from Lincoln Financialconfirms that more work needs to be done to bring awareness to the value that life insurance can provide to support a variety of financial goals. The research shows a significant gap between features consumers want in their financial products, like protected growth and tax advantages, and the knowledge that life insurance may help address these issues.

• 87% of those surveyed agreed that they would like to purchase a solution that protects from losses during times of market volatility.
• 88% indicated that they'd like to learn more about insurance policies that may offer tax advantages, now or in the future.
• Only 8% of individuals say they feel very knowledgeable about universal life insurance, with that number increasing slightly to 12% if the individual is working with a financial professional.

There's a clear interest in these benefits, which life insurance can provide, but also a lack of understanding that life insurance is a product that can provide them. The right life insurance policy can be used to help secure your hard-earned savings, offer access to savings via loans and withdrawals if needed and may offer tax advantages. With the options available today, there's a policy for every need and it's important consumers understand how life insurance can fit into their overall financial portfolios.

More than a death benefit

Life insurance can help support multiple financial goals, but research shows most people think of it mainly for the death benefit:

Among consumers who work with a financial professional and say each is a priority	% saying "I would expect to use life insurance for this"
Making sure my family is taken care of financially if I pass away	87%
Saving for education expenses for my children	43%
Protecting my money so I don't lose too much in the event of a market downturn	40%
Growing my wealth	34%
Being able to grow my wealth in a way that minimizes the amount of taxes I owe today or in the future	38%
Saving for retirement outside of a workplace retirement account or IRA	37%

Cash value life insurance

Survey respondents were given a definition of cash value life insurance - Life Insurance policies that allow you to invest money, which can grow over time. Because the money is invested in a Life Insurance policy, most distributions are income tax free - and asked their awareness of this type of policy.

Of those surveyed, 69% were not aware of cash value life insurance before taking the survey, yet 62% agreed a cash value life insurance policy sounds like something they may want to purchase. More than half (56%) of clients working with a financial professional want to talk more about cash value life insurance after learning about it.

It's clear that there's an interest in learning more about the value a life insurance policy can offer while living. Whatever the end use may be - supplemental retirement income, education expenses, emergency savings - having a pool of cash value can help in many ways.

Beyond confirming an interest in the product, the research also shows that people who own these solutions are satisfied with their purchase. 89% of people who already own cash value life insurance are glad they made the purchase and cash value product owners are more likely to be highly satisfied with their primary financial professional and willing to recommend them to others.

Opportunities for growth

According to LIMRA's U.S. Life Insurance Sales Survey, total U.S. life insurance new annualized premium has set sales records in each of the last three years and LIMRA projects this trend will continue in 2025.¹ Yet, despite this year-over-year sales growth, the need for life insurance continues to increase. 42% of American adults say they either need life insurance, or need more of it, a two-point rise from 2021.²

Life insurance may be a good choice to help support more individuals' financial goals. As research shows, the knowledge gap is significant, but so is the interest in learning more and the need for life insurance is increasing.

Take action

Lincoln Financial encourages those individuals currently working with a financial professional to ask to learn more about cash value life insurance and see if it can help with their financial goals.

For those not already working with a financial professional, Lincoln offers assistance in locating one on our website: Find a financial professional. A financial professional will work closely with you to start planning for the future for you and your family.

A variety of educational materials can be accessed on Lincoln's website to help consumers understand the many benefits life insurance offers:

Public link

Please use the above public link if you want to share this noodl on another website.