Black Americans: Fueling
the Expansion of U.S. Life
Insurance Ownership
#HelpProtectOurFamilies
1
The 2021 Insurance Barometer Study, LIMRA and Life Happens.
2
Life Insurance in Focus, LIMRA, 2021.
3
The 2021 Insurance Barometer Study, LIMRA and Life Happens.
4
Life Insurance in Focus, LIMRA, 2021.
Elizabeth A. Caswell
Associate Research Director
860-285-7739
Key Findings:
• Today, 56 percent of Black Americans own
life insurance, four points higher than the life
insurance ownership for the total U.S. adult popu-
lation (52 percent). However, 75 percent of Black
Americans believe they should have life insurance
coverage, representing a signicant opportunity for
life insurance companies who engage this market.
• While Black Americans are more likely to own life
insurance than the general population, 20 million
Black American adults say they need (or need
more) life insurance coverage.
• Nearly 4 in 10 (38 percent) Black Americans say
they are likely to buy life insurance in the next
12 months as a result of the COVID-19 pandemic,
outpacing U.S. adults overall (31 percent).
1
• Nearly 6 in 10 Black Americans (58 percent) say
they are likely to buy life insurance within the next
12 months.
Uninsured Black Americans are nearly
twice as likely as those in the general population
to say they will “denitely buy” life insurance
within the next year.
2
• Nearly 40 percent of Black American adults believe
they need 15 or more years of income coverage, in
the event of a primary wage earner’s death.
3
• Among Black Americans who own individual life
insurance, 68 percent have a permanent product;
46 percent own term insurance.
4
• Nearly a third of Black American households
(31 percent) indicate they would face nancial
hardship within a month or less should the
primary wage earner die. More than half of Black
American households (55 percent) would face
nancial hardship within six months following the
death of a primary wage earner.
Executive Summary
This brieng highlights recent ndings regarding Black American attitudes and behaviors about life insur-
ance. It also quanties the size and scope of the Black American market, providing recommendations on the
best ways to engage Black American consumers.
2
FIGURE 1
Financial Concerns of Black Americans
Financial Concerns
LIMRA research nds Black Americans report a
higher level of nancial concern than the overall
population and COVID-19 exacerbated these
concerns. Black Americans are signicantly more
likely to be concerned about being able to save for
an emergency fund, pay their monthly bills and their
mortgage, and leaving their families in a difcult
situation due to a premature death (Figure 1).
.
Black Americans All races/ethnicities
20%
24%
29%
27%
30%
28%
27%
33%
31%
32%
35%
37%
37%
43%
37%
26%
27%
29%
30%
33%
33%
33%
34%
34%
36%
37%
39%
41%
43%
44%
Paying off or reducing student loan debt
Paying for a child's schooling/college
Losing money on my investments
Paying off or reducing credit card debt
Burdening others with my burial/funeral expenses
Paying my mortgage or rent
Leaving an inheritance for my heirs
Job security/maintaining a steady income
Leaving depend
ents in a difcult nancial
situation should I die prematurely
Paying my monthly bills
Paying for medical expenses in case of illness or injury
Paying for long-term care services if I become
unable to take care of myself
Being able to support myself if I am unable to work
due to a disabling illness or injury
Having enough money for a comfortable retirement
Being able to save money for an emergency fund
Source: Black Americans: Life Insurance Ownership and Attitudes, LIMRA, 2021.
3
Black Americans are more likely to own individual
life insurance than the general population. Fifty-
eight percent of Black Americans own individual
coverage, while just 52 percent of all Americans
have individual coverage. Life insurance offered
through an employer is a benet Black Americans
value. Three in four say that the coverage they have
through work meets their household needs. Group
life insurance ownership increased 25 percent for
Black Americans in 2021, up ve points from
2020 (Figure 2).
FIGURE 2
Black American Life Insurance Product Ownership
19%
18%
25%
20%
25%
66%
67%
62%
65%
58%
15%
15%
13%
15%
17%
2017 2018 2019 2020 2021
Group life only Individual life only Both
Source: Black Americans: Life Insurance Ownership and Attitudes, LIMRA, 2021.
4
FIGURE 3
Reason for Owning Life Insurance
Reasons Black Americans Own Life Insurance
Thirty-one percent of Black Americans believe that
life insurance is only for nal expenses and 66
percent say that is the primary reason they own
life insurance (Figure 3). Just 48 percent of the
general population say the same. This perception
of life insurance could result in Black Americans not
purchasing enough coverage to provide income
replacement or enable wealth transfer, two key
ways life insurance can benet loved ones after a
wage earner dies. In some cases, younger Black
Americans are purchasing life insurance for other
family members — including siblings and parents —
to ensure that an unexpected nancial burden does
not fall to those who survive them.
Life insurance is one of the traditional methods for
building and transferring intergenerational wealth.
Four in 10 Black Americans cite wealth transfer as
the second most common reason they own life insur-
ance, compared with just 33 percent of the general
population.
Additional reasons Black Americans say they own
life insurance include supplementing retirement
income (33 percent), paying off mortgage debt
(32 percent) and replacing lost wages or income
from wage earner (31 percent).
Black Americans Totals
23%
35%
31%
29%
29%
33%
48%
25%
31%
32%
33%
34%
39%
66%
Pay for estate taxes or create estate liquidity
Help replace lost wages/income of a wage earner
Help pay off the mortgage
To supplement retirement income
Employer provides it to me
Transfer wealth or leave an inheritance
Cover burial and other nal expenses
Source: Black Americans: Life Insurance Ownership and Attitudes, LIMRA, 2021.
5
Black American Demographic Prole
• Black American adults number over 44 million
and represent 13 percent of the U.S. adult
population.
• The U.S. Black population grew more than 20
percent over the past 20 years and is younger
than the general population. The median age of
Black Americans is three years younger than the
overall U.S. population (35 versus 38 years old).
More than half (56 percent) of single-race Black
Americans were age 38 or less in 2019. Roughly
30 percent of the entire Black population is below
the age of 20, and 11 percent are 65 or older.
Life Insurance Market Opportunity
• The median income for Black American house-
holds is $45,870. More than 4 in 10 earn more
than $50,000; 27 percent earn $75,000 or more.
Nearly 1 in 5 (17 percent) earn $100,000.
5
• College completion continues to rise, with nearly
1 in 4 Black American adults over the age of 25
holding a bachelor’s and/or master’s degree or
higher, up from 15 percent in 2000.
• Forty-three percent of Black Americans report using
a professional nancial advisor, consistent with
the overall U.S. population (45 percent). However,
30 percent of Black Americans indicate they are
currently seeking a nancial advisor, which is six
points higher than the general population.
6
• Over half (56 percent) of Black Americans own
life insurance, suggesting over 24.6 million have
some coverage.
• Among the 56 percent Black Americans who own
life insurance, 14 percent say they need more
than they have today. Of the 44 percent of unin-
sured Black Americans, a third believe they need
it. Whether uninsured or underinsured, nearly
1 in 4 say they need life insurance, suggesting
a self-identied market of over 10 million Black
American consumers.
5
Income and Wealth in the United States: An Overview of Recent Data, pgpf.org, <https://www.pgpf.org/blog/2021/11/income-and-
wealth-in-the-united-states-an-overview-of-data> [Accessed 2021].
6
The 2021 Insurance Barometer Study, LIMRA and Life Happens.
6
Black American Preferences on
How to Buy Life Insurance
• Nearly 4 in 10 Black Americans (37 percent)
prefer to buy life insurance through a nancial
professional, versus 45 percent of the population
overall. Other places Black Americans visit to
purchase life insurance include life insurance
carrier websites (16 percent), and afnity group
websites like AARP (18 percent). Online aggrega-
tors, telephone, or direct mail were each cited by
7 percent of Black respondents who prefer these
methods to obtain individual life insurance.
7
• When obtaining life insurance coverage at work,
channel options are key. Black Americans prefer
using their employer’s online enrollment portal
(34 percent) to enroll in their workplace benets.
One in four Black Americans say they would
prefer to enroll via a paper enrollment form and
nearly 1 in 3 (28 percent) would like one-to-one
support to enroll by either meeting with someone
or using the telephone.
8
• Nearly 6 in 10 Black Americans report using
social media as a source of information on
nancial topics — a proportion greater than
other market segments. Facebook, YouTube, and
Instagram are the top three sources of online
nancial information for them.
• While most Black Americans prefer to connect
with their life insurance provider every 1 – 3
years to review their policies and coverages, 1 in
4 prefer to reach out to their advisor/agent on an
as-needed basis.
9
• Black Americans are less likely to have broad-
band service and personal computers at home,
and therefore rely more on smartphones. Device-
agnostic access to online life insurance tools
and resources will ensure more Black Americans
have the information they need to make informed
decisions about life insurance.
Opportunities to Educate and Engage
There is a great opportunity for life insurers
and nancial professionals to help dispel Black
Americans’ misconceptions about life insurance and
get the coverage they know they need.
• Fewer than 4 in 10 Black Americans feel very
knowledgeable about life insurance, which is in
line with the general population.
• The top reason Black Americans give for not
purchasing coverage is that it’s too expensive, yet
LIMRA research nds Black Americans are more
likely than the general population to overestimate
the cost of life insurance (75 percent versus 50
percent). They are also more likely to believe
the coverage they get through their employer is
adequate.
• Learn about the Black American community and
culture. The more you can demonstrate an under-
standing of their unique needs and present viable
solutions, the greater trust you can build with your
Black American clients.
7
Life in Life Focus Study, LIMRA, 2021.
8
Ibid.
9
Ibid.
7
Research and Related Resources
• Life Insurance in Focus, LIMRA, 2021
•
2021 Insurance Barometer Study, LIMRA and Life Happens
•
Black Americans: Life Insurance Ownership and Attitudes, LIMRA, 2021
•
2020 Insurance Barometer Study, LIMRA and Life Happens
•
Let’s Talk Life — Why do Consumers Live With a Life Insurance Gap?, LIMRA, 2021
•
The economic state of Black America: What is and what could be, McKinsey, 2019
•
Black bachelor’s degree holders more than doubled since 2000, Pew Research Center, 2021
•
The Financial Needs of Family Caregivers Series, LIMRA, 2019
•
Life Insurance in Life Stages, LIMRA, 2020
•
Why the homeownership gap between White and Black Americans is larger today than it was over
50 years ago
, CNBC.com, 2020
•
Population more ethnically diverse 2010–2020, U.S. Census, 2020
•
Income and Wealth in America, Peter G. Peterson Foundation, November 2021
•
The Growing Diversity of Black America, Pew Research Center, 2021
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