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Whole life or not whole life: that is the life insurance question – Part 5

Part 5: Contemporary trends

In Part 4 of this series, we discussed the creation of new products, to reach out to new classes of consumers.

In Part 5 we will discuss contemporary trends. Here are some highlights from Think Advisor:


“1965: Serviceman’s Group Life Insurance was enacted into law to provide life insurance to members of the armed forces on active duty. The insurance is underwritten by a pool of commercial insurers, and the federal government pays administrative expenses and the extra cost resulting from the increased risk of military duty.

“1976: The end of World War II and the economic boom that followed boosted sales of life insurance in the United States. By the mid-1970s, 72 percent of the adult population of the United States and more than 90 percent of all husband and wife families owned some form of life insurance.

“2001: A total of 2,977 people perished in the Sept. 11 terrorist attacks in New York, Washington, D.C., and Pennsylvania. The Insurance Information Institute estimates $1.2 billion was paid out in life insurance claims.

“2010: LIMRA’s 2010 Life Insurance Ownership Study found that 30 percent of U.S. households (35 million) had no life insurance protection at all, and only 44 percent of U.S. households had individual life insurance, marking a 50-year low for the life insurance industry.

Subsequent studies in the years since 2010 have revealed that the gap has not improved.”

What are we to make of the huge insurance gap in the American population? This despite the efforts of the industry to provide products for all classes of people, and a track record of paying out billions of dollars of benefits.

This question requires serious attention, and will be addressed in subsequent essays.