Overlooked life insurance opportunities in your stateArticle added by Jeff Reed on June 6, 2014
Jeff Reed

Jeff Reed

San Diego, CA

Joined: May 07, 2012

Opportunities abound when it comes to the sale of life insurance. The economic climate is causing many to reevaluate their portfolios and seek the unique attributes that life insurance affords.

Consumer demand continues to trend upwards; however, that does not necessarily mean our industry is effectively connecting with customers. Consider these amazing data points from a recent LIMRA study, "Trillion Dollar Baby":
  • 14 million households indicated that the reason that they had not yet purchased the insurance they believe they require is that they had not been approached by any advisor about life insurance.

  • 8 million U.S. Households indicated that they “don’t have enough life insurance.”

  • 29 million households said they were likely to buy life insurance in the upcoming 12 months.

  • The 44 percent of households who feel they do not have enough life insurance, on average, said they need enough insurance to replace six years of income.
And the U.S. Census provides the following key statistics about retirement in America:
  • Out of 100 people who start working at the age of 25, by age 65, 29 percent are dead.

  • Of the same 100 people, 63 percent are dependent on Social Security, friends, relatives or charity.

  • 80 percent of people ages 30–54 believe they will not have enough money put away for retirement.

  • 36 percent of Americans don’t save anything for retirement.
Of course, simply being aware of these statistics is simply the consolation prize. The real question is how can the data drive prospecting and sales practices?

The answer requires a more rigorous analysis in an effort to identify life insurance sales opportunities on a state-by-state basis. While on the surface, it may seem that there are too few sales opportunities, they are actually abundant, and there are more reasons than ever to get in front of new prospects.

State-by-state sales opportunities

Rather than generalize about this information, I have chosen instead to take a deeper dive into life insurance sales opportunities on a state-by-state basis.

The LIMRA and Census numbers have been on my mind for a while, so I decided to take a deeper dive to assess where in the U.S. the opportunities are the brightest. I have compiled a significant mix of relevant data that should give advisors reason to get excited, regardless of where you find clients.
I evaluated eight key factors that help quantify life insurance opportunities by state. They are:
  • State income taxes (taxfoundation.org)
  • Median household income (U.S. Census)
  • Retirement savings need (ING Retirement Research Institute)
  • Life expectancy (measureofamerica.org)
  • Debt cancellation need (Lending Tree and ACLI)
  • Income replacement need (U.S. Census and ACLI)
  • Average number of in-force policies per household
  • America’s health rankings’ health score – potential insurability
What does the data tell us? Each region, and even each state, has unique needs that require a unique perspective and approach with prospective clients.

Consider the following:

Hawaii: Who wouldn’t want to work near the sands of Hawaii? After all, aside from the sun and perfect beaches, it has the second highest state income tax rates in the country and expensive real estate. This translates into high average mortgage amounts which are often not covered by enough in-force life insurance.

Washington D.C.: The nation’s capital may just have an argument as the best place in the country to sell life insurance these days. With high taxes, high median household income, low average face amounts, expensive real estate and low retirement savings scores, D.C. and its neighboring states represent a golden opportunity for life insurance sales of all types.

New Jersey: New Jersey’s high taxes, incomes and expensive real estate mean there are significant planning opportunities there. It also ranks high in terms of health score and life expectancy.

Every state has particular opportunities to pursue. There is no shortage, and the numbers show enormous market potential. LIMRA’s report expressed that the opportunity exceeds $7 trillion. Find out where you can get your piece of it!

Learn more

Other states that rank high on the list of great places to sell insurance include:
  • Vermont
  • Maryland
  • New York
  • Massachusetts
  • California
Where does your state rank?
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