Less than half of millennials have life insurance — here’s why that’s a problem

A recent survey by insurance-comparison website Insuranks reveals that less than half of millennials, born between 1981 and 1996, have life insurance, with only 47% indicating they have a policy. Interestingly, 48% of those without coverage expressed interest in obtaining it. The primary hurdle identified by 66% of respondents was the perceived high cost of premiums, while 29% felt overwhelmed by the complexity of choosing a policy.

Among married millennials surveyed, 50% said the loss of their spouse would result in financial hardship within six months, and 1 in 6 believed it would take only a month to face such difficulties. Despite these concerns, only 36% of respondents without life insurance mentioned the lack of a family to support as their reason for not having coverage.

Understanding the importance of life insurance, especially for those with financial dependents, is crucial. Even without a family, life insurance can cover funeral expenses, which can average over $8,000. It’s emphasized that obtaining life insurance is more affordable and easier when younger, with age playing a significant role in determining premiums.

For those seeking affordable coverage, term life insurance is recommended, covering a specified period (typically between 10 and 30 years) and providing a death benefit if the policyholder passes away during the active period. Compared to whole life insurance, term life is generally more cost-effective. Shopping around for quotes and conducting thorough research can help individuals make informed decisions.

To address the affordability concern, CNBC Select recommends Haven Life Insurance for its Haven Term policy, offering coverage up to $3 million for individuals up to age 64, and the Haven Simple policy, providing coverage from $25,000 to $1 million for those aged 20 to 55. Policies can be purchased online without a medical exam.

In conclusion, while cost remains a common barrier, finding the right life insurance policy can alleviate stress and potential financial hardships, emphasizing the importance of obtaining coverage, especially at a younger age.