First Command Reports: Military Families Show Sustained Preference for Permanent Life Insurance

Business Wire

First Command Financial Behaviors Index® reveals that 73 percent of middle-class military families own a permanent life policy

FORT WORTH, Texas--(BUSINESS WIRE)-- Members of America’s career military continue to display a clear preference for permanent life insurance, according to the latest findings of the First Command Financial Behaviors Index®.

First Command's annual life insurance survey reveals that 73 percent of middle-class military families (commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000) own some form of permanent life coverage. And among survey respondents who don't own a permanent life policy, roughly half (49 percent) say they are likely to consider purchasing one for themselves or someone in their household. Those rates generally align with the demand recorded over the previous three years.

Interest in permanent life insurance is considerably stronger in military families than in the general population. The Index reveals that 45 percent of middle-class civilian families own some type of permanent coverage. Among non-owners, 31 percent say they are likely to consider purchasing a permanent life insurance product.

The most popular forms of permanent life insurance coverage include:

Whole life, which is owned by 36 percent of military respondents versus 27 percent of their civilian counterparts.
Universal life (30 percent versus 11 percent)
Variable life (17 percent versus 8 percent)

Service member demand for temporary life insurance coverage is down slightly this year. Thirty-nine percent of military families report owning term life products, down 7 points from last year. Civilian ownership of term life products is also at 39 percent, unchanged from last year.

Military families have turned to permanent insurance products as supplemental coverage to their government benefits. Active-duty personnel are eligible for up to $400,000 in Servicemembers' Group Life Insurance, commonly known as SGLI. They may add optional spousal coverage of up to $100,000 and dependent coverage of up to $10,000. After leaving the service military personnel may convert SGLI to Veterans' Group Life Insurance (VGLI); however, premiums may be higher and are based on the age of the insured. Supplemental commercial policies allow military families to increase their overall coverage now and provide longer-term protection for their post-military lives.

“Adding permanent life insurance to government-provided coverage allows America’s career military families to more fully and effectively confront their present and future needs,” said Scott Spiker, chairman/CEO of First Command Financial Services, Inc. “This supplemental strategy allows families to address the current uncertainties of military life today – uncertainties that can include the risk of a service-related death – as well as pursue long-term financial security tomorrow.”

First Command conducts an annual life insurance survey of military families as part of its September observance of Life Insurance Awareness Month, which was created by the LIFE Foundation in response to growing concern about the large number of Americans who lack adequate life insurance protection.

About the First Command Financial Behaviors Index®

Compiled by Sentient Decision Science, Inc., the First Command Financial Behaviors Index® assesses trends among the American public’s financial behaviors, attitudes and intentions through a monthly survey of approximately 530 U.S. consumers aged 25 to 70 with annual household incomes of at least $50,000. Results are reported quarterly. The margin of error is +/- 4.3 percent with a 95 percent level of confidence. http://www.firstcommand.com/fbi/

About Sentient Decision Science, Inc.

Sentient Decision Science was commissioned by First Command to compile the Financial Behaviors Index®. SDS is a behavioral science and consumer psychology consulting firm with special vertical expertise within the financial services industry. SDS specializes in advanced research methods and statistical analysis of behavioral and attitudinal data.

About First Command

First Command Financial Services and its subsidiaries, including First Command Financial Planning and First Command Bank, coach our Nation’s military families in their pursuit of financial security. Since 1958, First Command Financial Advisors have been shaping positive financial behaviors through face-to-face coaching with hundreds of thousands of client families.

First Command Financial Services, Inc., is the parent of First Command Financial Planning, Inc. (Member SIPC, FINRA), First Command Advisory Services, Inc., First Command Insurance Services, Inc. and First Command Bank. Financial planning services and investment products, including securities, are offered by First Command Financial Planning, Inc., a broker-dealer. Financial planning and investment advisory services are offered by First Command Advisory Services, Inc., an investment adviser. Insurance products and services are offered by First Command Insurance Services, Inc., in all states except Montana, where as required by law, insurance products and services are offered by First Command Financial Services, Inc. (a separate Montana domestic corporation). Banking products and services are offered by First Command Bank. In certain states, as required by law, First Command Insurance Services, Inc. does business as a separate domestic corporation. Securities products are not FDIC insured, have no bank guarantee and may lose value. A financial plan, by itself, cannot assure that retirement or other financial goals will be met. First Command Financial Services, Inc. and its related entities are not affiliated with, authorized to sell or represent on behalf of or otherwise endorsed by any federal employee benefits programs referenced, by the U.S. government, or the U.S. armed forces.