Household economics are not what they used to be and the changes are most evident in millennial households. Roles are changing and sources of income are shifting. Financial institutions, insurance companies, and investment firms are studying the impact and influence of women on household finances.
The developing trends will influence how financial professionals grow their practices and attract new clients. Women represent an untapped market. In combination, the following insights make the case for having the important conversation about disability insurance with your female clients.
#1: Women are primary breadwinners and financial decision makers
These changing realities make income protection insurance essential for most women. In more than half of households, women act as the chief financial decision maker. According to Women, Power, and Money, 60 percent of women are the household’s primary breadwinners. Only 40 percent are married. The rest are single, divorced, widowed, or partnered.
Today’s modern family may be even more susceptible to financial insecurity than ever before. Many single women are parents and same-sex partnerships often have children. Single women often feel insecure about their financial stability. As heads of households with children, primary or shared income earners, or as the sole income earner, income disruption due to an illness or injury can tip an already teetering economic balance.
Suggestion for advisor: Disability insurance transfers some of the financial risk of being unable to earn an income. Help clients understand the financial implications of bearing the entire risk relative to the cost of sharing the risk. Disability insurance is affordable especially when compared to the alternative.
#2: Women are three times more likely to suffer a disability
Most new long-term disability claims are made by women. A typical healthy, 35-year-old non-smoking woman, has a 24 percent chance to be unable to work for three months or longer over the course of her career, lasting on average between 31.6 and 34.6 months. Not only are women more likely than men to file a disability claim, many women work in industries and for employers that often do not offer disability insurance as an employee benefit.
Suggestion for advisor: Help clients realize the probability of suffering an income-interrupting illness or injury and the typical time frame to be without a paycheck. Female clients who are planning for a family are prime candidates for disability insurance. For the best underwriting results and premium, the time to apply is before the pregnancy.
#3: Women want to be financially informed
While many more women find themselves responsible for these important household decisions, only 30 percent use a financial professional. Those that do use a professional wish they had done so much sooner. Overall, women are confident in their day-to-day financial decisions but have doubts about long-term decisions, such as the need for disability insurance. The desire to be knowledgeable about financial products, investments, and retirement planning is strong in 63 percent of women.
Suggestion for advisor: Empower your female clients through education, explanations, and examples of concepts and products that help them reach their financial goals. You will be rewarded with their loyalty and referrals.
Count on DIS to design a disability insurance solution that combines the right product, features, and affordability for your clients. Contact your DIS representative with the client objectives and details; in turn we’ll prepare several quotes for your review and provide all the back-office support you require. Also, make sure to download this great client handout.