Given the rapid expansion of the Latino population in the U.S. — the growth rate among Hispanics is projected to be triple that of any other ethnic group over the next 20 years — one might expect them to be a rich source of prospects for life insurance professionals.
Cracking the Latino market may, however, be a tad more difficult, if new data from LIMRA and the LIFE Foundation is any guide. The research, reported in LIMRA/LIFE’s “2013 Insurance Barometer Study” and timed for release during September's Life Insurance Awareness month, shows that Hispanics still have a low rate of life insurance ownership (59 percent) when compared to Whites (62 percent) and African Americans (66 percent.)
Hispanics represent 16.3 percent of the total U.S. population and have a combined purchasing power of more than $1 trillion, yet this demographic feels underserved and uninformed on life insurance ownership and options, the survey indicates.
Most Hispanics (75 percent) still believe the cost of life insurance is too expensive. And almost half (49 percent) remain uneducated about how much/what type of policy to buy.
Hispanics point to multiple financial priorities that take precedence over purchasing life insurance, including paying for medical expenses (66 percent), reducing credit card debt (57 percent) and paying for a child's schooling/college (39 percent.) Also, 28 percent note that they have not purchased life insurance because they've yet to be approached by insurance agencies.
The study indicates that almost half of Hispanics are very or extremely concerned about dying unexpectedly compared to less than a third of the general population. Among those Hispanics that are buying life insurance, the top reasons cited for buying it were to:
• Cover burial and other final expenses (89 percent)
• Help replace the lost income of a wage earner (69 percent)
• Transfer wealth/leave an inheritance (67 percent)
• Pay off a mortgage (57 percent)
• Cover home expenses such as child care, transportation, cooking and cleaning (54 percent)
When Hispanics evaluate important factors related to the purchase of life insurance, many (51 percent) consider that getting the proper amount of coverage ranked highest, followed by securing coverage that is guaranteed for life (39 percent.) In addition, the survey notes, 36 percent agree that obtaining the best price was an important factor.
When questioned about common financial concerns, 66 percent of Hispanics say they are extremely or very concerned about having money for a comfortable retirement, followed next by paying for long-term care services (59 percent.)