By Warren S. Hersch
Young Americans with dependents have on average a $610,000 gap in life insurance coverage
, new research shows.
The Guardian Life Insurance Company of America and LearnVest Planning Service released this finding in a jointly conducted study, “Life and Disability Insurance: What 20- and 30-Somethings Think.” The report explores the attitudes and behaviors of men and women in their 20s and 30s.
The report identifies a large gap between the dollar amount respondents would want to “make all their dependents’ troubles go away” ($1 million on average) and the average face amount of their policies ($390,000).
“The discrepancy may be due in part to a belief that life insurance obtained through work is all you need; 65 percent of respondents get their coverage this way,” the report states. “While an employer’s group plan can be a great start, typical coverage amounts may not be enough to offset the economic impact to you family if you’re not there to provide for them.”
While almost 60 percent of respondents’ significant others have life insurance coverage, the report adds, 35 percent say they don’t know what the policy type is.
The Guardian Life survey finds the lack of knowledge
most pronounced among those ages 21-30 and among women ages 21-30 and 31-40: 43 percent of individuals in these cohorts are unaware of the policy type owned by their significant other.
Equally disconcerting, the report adds, almost 20 percent of respondents indicate they don’t believe they need life insurance because their spouse is covered.
The survey notes also that the primary person most respondents feel responsible for is their spouse or significant other: six in 10 respondents have named their partner as a beneficiary of life insurance policy and almost one-third have named their children.
Additionally, the report observes that two-thirds of respondents foresee their policies paying off funeral expenses; more than half expect the pay-off to cover their debts and mortgage or rent.
The survey discloses also that a majority of the respondents don’t have disability income insurance to protect their income if something were to happen to them. Just over one-third (35 percent) have disability income insurance
, compared to 57 percent who have life insurance.
Originally published on LifeHealthPro.com