A new LIMRA study about African Americans finds that middle-market African Americans are more likely to consider ‘saving for an emergency fund’ as a top financial priority than the middle market as a whole (74 percent vs. 62 percent). Debt reduction goals also are considerably more important for middle-market African Americans.
African Americans make up 12 percent of the 52 million households in the middle market and are more likely than the general population to own life insurance.
The study found that 6 in 10 middle-market African Americans own individual life insurance, compared to only 46 percent of the U.S. middle market. Their higher rates of ownership are in line with their positive attitudes about life insurance. Only about half of the general middle market strongly agrees that most people need life insurance; in sharp contrast, 7 in 10 African Americans strongly agree with this statement.
Nearly half of uninsured and a full third of insured middle-market African Americans say they are likely to buy life insurance in the next 12 months, which is much higher than the total middle market. LIMRA’s research revealed that only 29 percent of uninsured middle-market consumers are likely to buy in the next year, and only a quarter of middle-market consumers with life insurance intend to buy additional coverage.
When choosing a life insurer, a company’s reputation for service and paying claims are the highest rated characteristics for both African Americans and the broader middle market. Sixty-two percent of African Americans also rank a company’s brand as an essential consideration, compared with the market overall, where less than half see this as a priority.
Financial professionals who are willing to educate, explain and be responsive are the most preferred across the entire middle market. Financial professionals who can show how life insurance fits into a client’s overall financial situation are favored by a much higher proportion of middle-market African Americans than the general market.
LIMRA’s research suggests that to effectively reach the African American market, financial professionals can provide potential clients with strategies for saving and debt reduction. Financial professionals also have a clear opportunity to discuss financial protection because African Americans are more likely to own and buy life insurance.