Experts say that people are buying this coverage out of a fear of death and increased awareness of financial risk.
US life insurance is experiencing a considerable rise in popularity due to the coronavirus pandemic.
Consumers, young adults in particular, have been purchasing coverage at elevated levels.
Since the spring, US life insurance companies have been recording notably higher sales levels than they were at the same time in 2019. The trend has taken off as young adults have seen that thousands of Americans were dying from COVID-19 related illness. Experts say that this is a logical response to the circumstance, according to a CNBC report, as this coverage is essentially a financial backstop in case a person dies.
The pandemic has made the potential risks of losing a vital source of income very plain to many consumers who have felt as though that isn’t a risk that they will need to worry about for a while. They have come to think about what happens if the main breadwinner of the family unexpectedly dies from COVID-19 and how they will fill that immediate income gap.
“It’s forced the idea of financial protection and mortality to the top of mind for consumers in a way very few events have,” explained Policygenius CEO and co-founder Jennifer Fitzgerald.
As a result, like toilet paper in the early spring, US life insurance has become a pandemic panic buy.
This is a substantial change in direction for this particular market. Sales have been easing over the last several years. In 2010, about 63 percent of American adults had a life policy. At the start of this year, only just over half of American adults said the same thing.
From March through May of 2020, Google Search traffic spiked by 50 percent for the term “life insurance” when compared to the same months in 2019, said Fitzgerald. During those months, many states had implemented shelter-in-place orders. Several states, such as New York, New Jersey, Florida, and others had experienced massive outbreaks.
Tens of thousands of people continue to be infected every day and hospitals have been going through waves in which their capacity has been overwhelmed. More than 200,000 Americans have died from the virus and estimates suggest that figure could double before 2021 has the chance to start. Hearing these figures can easily drive consumers to want to protect their families’ financial futures with US life insurance policies in place.