African-Americans view life insurance as more than a means to pay for final expenses. They are increasingly looking to life insurance as a way to transfer wealth and leave a legacy.
Those were among the findings of New York Life’s Insurance Gap Survey that showed African-Americans report more financial stress than the overall population, but are also more proactive about addressing it.
Half of African-Americans surveyed said planning for the future causes them a high degree of anxiety, versus 44 percent of all adults. Nearly one-third of African-Americans reported feeling financially insecure and 46 percent said they are concerned about maintaining their current level of income.
Despite this level of financial stress, nearly 80 percent of African-Americans said having life insurance is a goal for them, versus 63 percent of all adults. More than 90 percent of African-Americans said they believe life insurance helps future generations succeed.
“In thinking about their financial futures, African-Americans recognize the opportunity to use life insurance to protect their families and at the same time, create wealth for the black community at large,” said Eric Jackson, New York Life corporate vice president and market manager. “Our agents are consistently seeing attitudes about life insurance shift from primarily using proceeds to cover burial expenses to leveraging policies to grow small businesses, fund a college education and leave a legacy for future generations.”
African-Americans are looking for expert guidance, the survey showed, with nearly 80 percent saying they would consider seeking professional help from a financial advisor. Of those African-Americans who are already working with an advisor, 65 percent say they meet with their advisor more than once per year, versus 49 percent of all adults.
How do advisors approach African-Americans about life insurance? “We think the conversation has to be more about how do we use life insurance as a tool to build wealth in the community stead of just using life insurance as a burial tool,” Jackson said. “Advisors, as they have that conversation, can show that life insurance can help someone move forward financially and do more than cover final expenses.”
Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.
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