Adapting Life Insurance Strategies for Younger and Older Clients

Life insurance advisors are encountering a shift in client expectations, particularly among Millennials and Gen Z, who often view life insurance less as a traditional death benefit and more as a versatile financial asset. Financial pressures such as student debt and housing costs, combined with evolving life milestones, have led younger generations to deprioritize life insurance unless its benefits are tangible during their lifetimes.

Industry experts advocate for emphasizing living benefits in policies, such as riders for chronic or critical illnesses, which offer financial support during a policyholder's life rather than solely after death. Innovations including subscription-style premiums and wealth-building policy features are aligning life insurance more closely with the evolving financial goals of younger consumers. For older policyholders, life insurance settlements serve as an important liquidity option, providing significant returns when policies are sold rather than surrendered or lapsed. This option is particularly valuable for covering long-term care and medical expenses, often alleviating the financial burden on investment portfolios.

The life settlement market, regulated in 43 states, ensures consumer protections with clear disclosures, competitive bidding, and no medical exams required, contributing to its increasing adoption. Advisors are encouraged to present life insurance as a dynamic, long-term financial asset within client portfolios, highlighting the flexibility to keep, adjust, exchange, or sell policies.

A fiduciary approach that includes all potential options, supported by real-world examples of life insurance funding health care and debt repayment, helps clients understand the tangible and adaptable benefits of their policies.

This strategic repositioning of life insurance supports advisors in meeting the needs of a diverse client base across generations, fostering trust and improving client engagement.