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Minority Buying Power and Life Insurance
Despite the current ups and downs of the national economy, statistics show that the overall buying power—after-tax income-- of the American population will grow to $11.1 trillion in 2009. And, according to the Selig Center for Economic Growth, minority groups, including African-Americans, Asians and Hispanics, will control an increasing portion of that wealth.
Minority buying power is growing more quickly than buying power overall as minorities move into better jobs or start their own businesses. By 2009, African-American buying power is projected to grow to $965 billion, Hispanic buying power to $992 billion, Asian buying power to $528 billion and Native American buying power to $66 billion nationally.
Despite this predicted economic growth, national surveys show that many of these consumers are being underserved when it comes to life insurance protection. A 2005 survey by the market research firm, the polling company inc™, found that minorities in lower-income households are being abandoned by the life insurance marketplace.
The survey found 92% of African Americans and 82% of Hispanics said they believe life insurance is essential, as compared to 72% of Anglos. However, only 39% of African Americans reportedly own a life insurance policy - well under the national average of 47%. Forty percent of Hispanics polled said they own life insurance.
The study found that low incomes and the lack of availability of life insurance agents who are members of those minority groups are the main reasons why these consumers are not getting the life insurance they want and need. An overwhelming 79% of households earning under $50,000 per year believe life insurance is the most important type of insurance coverage to own because they do not have the financial means to support a family if the main breadwinner dies.
The other factor, as reported in a recent survey by insurance consulting firm A.M. Best, found that while African Americans now comprise about 14% of the U.S. population, only 2.5% of licensed insurance agents are African American. And among Hispanics, who make up nearly 15% of the U.S. population, only 3% of the nation’s licensed life insurance agents are part of this ethnic group.
Half of all the Hispanics questioned reported never having met with a life insurance agent. The statistics for African-Americans were less bleak, revealing that 24% reported having no previous experience with an agent but more than one-third were unfamiliar with life insurance products.
“These underserved consumers can take their fate in their own hands by simply going to the Internet,” says E.C. Gordon, Chief Executive Officer of LifeQuote™, an online life insurance service that finds the best policy rates among the nation’s leading.
The online life insurance services provide detailed life insurance companiesinformation on the types of life insurance people can choose , in addition to tools that help buyers calculate how much life insurance coverage they actually need.
“Everybody needs life insurance,” says Mr. Gordon of LifeQuote. “An educated consumer has choices by either doing it all yourself or letting one of our licensed agents guide you through the simple process of buying some peace of mind for you and your family,” he added.
For more information go to www.lifequote.com |
