Women and Life Insurance

Membership of women in the American Academy of Family Physicians has increased dramatically in the last decade. In 1985, women accounted for 8.8% of all members. Less than 10 years later, they represented 18.6%. (AAFP Committee on Women in Family Medicine)

More significantly, 46.7% of AAFP student members and 39.3% of resident members are women.

Despite the huge professional gains by women in the medical field and in other industries, women as a group continue to be underinsured in terms of protecting their economic value.

For this reason AAFP Insurance Services produced this special publication as past of its educational series on insurance matters.

Why Should A Man Buy Life Insurance?

To protect his family and replace lost income if he dies. Life insurance pays off mortgages, funds college educations if the income earner can't be there...guarantees that the spouse won't have to sell the home or otherwise suffer a severe drop in standard of living. The decision to purchase insurance reflects a loving commitment to family and a recognition of the need to meet other financial responsibilities.

Why Should A Woman Buy Life Insurance?

For the very same reasons! Life insurance has always been viewed as one of the most cost effective ways for men and women to protect their loved ones and make sure that their other obligations are properly met in the event that anything should happen to them.

There's Only One Problem:

Women's needs for life insurance have almost never been adequately addressed. The result is millions of spouses, children and other dependents who may be exposed to serious financial risk.

Historically, this can be explained by the somewhat traditional (though not totally accurate) perception of the distinct roles of men and women in our society. Whether right or wrong, the husband was almost always the primary focus when it came to life insurance. It was generally believed that if he died, his income needed to be replaced to care for his surviving wife and children. The wife, on the other hand, generally ended up with wife insurance, enough to cover her final expenses and funeral if she died. Many women had no life insurance at all.

Even as recently as 1977, adult males accounted for 57% of all life insurance policies purchased in this country, says the American Council of Life Insurance. Adult females were listed as the insureds on just 29% of policies purchased. But even those figures don't tell the whole story. In that same year, coverage on men added up to 85% of the total dollar amount of protection. Coverage on women amounted to just 10% of the total!

The More Things Change...

As we enter the last years of the 20th Century, it's obvious that a great deal has changed in our society, especially when it comes to the role of women. Nowhere is the change evidenced more dramatically than in the work place. In 1960, for instance, only 28 married women out of every 100 were active income earners. by 1990, however, that number had jumped to 52 out of every 100. And the numbers are increasing each year.

But some things haven't changed, especially when it comes to life insurance. Women as a group continue to be underinsured...their life insurance needs often still treated as an afterthought. The facts speak for themselves. According to research conducted by the Life Insurance Marketing and Research Association:

• In 1990, adult males accounted for 48% of all life insurance policies purchased, while adult females accounted for 38%.
  
  
• In that same year, adult males accounted for 68% of the total dollar amount of coverage, versus 27% for women.
  
  
• The average size of the individual life insurance policy sold to a woman in 1991 was half the amount of a comparable policy sold to a man.

Is Your Life Insurance Adequate?

Does it protect your loved ones, help you meet your financial objectives and fulfill your responsibilities?

The Academy recommends that you review your coverage and needs:

• If you're part of a two-income family: The two-income household is now the norm...and the wife's income is for more than just incidentals and knickknacks. Husbands and wives are economic partners. Today's two-income families depend on both pay checks to make ends meet. In fact, according to the Bureau of Labor Statistics, 29% of women in dual-income households earned more than their husbands in 1991.
  
  If anything happened to you--and the income you generate--would your family be able to remain in their home? Would your children be able to achieve their education goals? Would your family suffer a severe financial loss? Adequate insurance on your life can replace your income, remove uncertainty and help guarantee your family's financial security.
  
  
• If you're a single parent heading a household: The single parent family is the fastest-growing population group in the country...increasing from 8.2 million households in 1970 to 15.9 million in 1990.
  
  As a single parent, you may be the sole breadwinner, responsible for the support and care of your children. In this respect, your need for life insurance is even more crucial than in dual-parent households...which will have another source of income if one parent dies.
  
  
• If you're a full-time homemaker: Far from a dying breed, nearly half of all married women continue to be full-time mothers and homemakers. This is just as much a partnership as the two-income family in that it takes the efforts of both to make the household function. The services of the full-time homemaker, while often under-valued, are worth tens of thousands of dollars a year...which is what it would cost to replace those services should anything happen to you.
  
  
• If you're a single women: Many single women--who make up 20% of the population in this country--believe they have no need for life insurance. The fact is, very often, that need is even greater than for married women. Why?
  
  That's because being single isn't always the same as being alone. You may have responsibilities and obligations. There may be educational loans, as well as other debts.
  
  Additionally, should anything happen to you, there will be final expenses, which can run into the tens of thousands of dollars. These obligations--which could fall on parents and other loved ones--can be met by owning an adequate amount of life insurance. Life insurance purchased today can also protect your future insurability.

Recommendation:

Do you need additional life insurance protection? That's a question only you can answer. Review your needs today. If you believe you need additional coverage, consider the AAFP High Limit Life Policy for Academy member and their spouses.