Mind the gap: Women and life insurance

Mom helping son with homework

Collectively, we understand that it’s a good idea to spend wisely, keep a fund for emergencies and save for retirement, but life insurance as a financial planning tool is sometimes overlooked — particularly by women.

More men have life insurance than women. It’s a significant gap, and one that is out of step with current demographic and financial realities. In today’s world, it’s important for women to look ahead and take advantage of financial planning opportunities that can help them achieve their goals and build security for the future. 

By the numbers

In the United States, 47% of women have life insurance compared with 58% of men, according to a 2021 study from LIMRA.1 That gap is smaller in Canada, but still exists.2

Women account for 47% of the workforce in the U.S. and are the primary breadwinners in 41% of families with children under 18.3 The workforce looks similar in Canada, where 40.9% of women are the primary earners in the family, up dramatically from 17% in 1976.4  

Across the globe, women live longer than menand for married couples, women are more likely to outlive their male spouse.5

These numbers help paint a picture of the larger demographic shifts happening in households and demonstrate that the number of women with life insurance coverage is not keeping up with the trends. But, when it comes to financial planning, it’s your own unique situation that is most important, whether you are a primary breadwinner or a primary caregiver. Or both. Or neither. Sound financial planning for the future includes a clear life insurance strategy. And yet, women don’t own life insurance in the same numbers as men. It’s time to close that gap.

Look to the future

There are various reasons why people, specifically women, may not purchase life insurance:

  • Their spouse is the primary breadwinner and has coverage
  • They have life insurance through their job (or their spouse’s job)
  • Stay-at-home parent without an income
  • It costs too much
  • They don’t want to think about dying

While all of these concerns are common, some are myths and each one is important to explore with a qualified life insurance professional. Every situation is unique and knowing your needs and the options available to you is the best way to start creating your plan. 

No “pink tax”

Research shows that many people significantly overestimate the true cost of life insurance before getting the facts.6 For woman in particular, the so-called “pink tax” — higher prices for products and services marketed toward women — doesn’t typically apply to life insurance. Men have lower life expectancy, which means insurance companies have to prepare to pay out the benefit earlier. For this and a few other reasons, women on average tend to pay less for life insurance than their male counterparts.

Life insurance from an employer

When it comes to life insurance coverage provided by an employer, it can certainly be an excellent start, but it typically ends if you leave the job and may not provide enough coverage for your needs. For stay-at-home parents, unpaid labour is hugely undervalued and the cost of losing a caregiver is significant for any family.7

More than a death benefit

We don’t like to think about the end of life, but ignoring it can cause undue stress. On the other hand, preparing for it with sound financial planning may allow you to put it out of your mind by providing a sense of security.

In addition, many whole life insurance policies provide cash-value growth that can be borrowed against through a loan. Women can potentially access this cash while still alive to use to cover emergencies or other expenses like education or home renovations.8 This, along with other possible “living” benefits that may be available with certain life insurance policies, can help women create a well-diversified financial plan for today, while maintaining security for the future. 

Your needs, your opportunities

Men, women, kids, grandparents, families — every situation is different and unique. There isn’t a one-size-fits-all strategy for financial security. However, the gap in life insurance coverage between men and women is abundantly clear and it’s important for women to start taking advantage of the planning opportunities available through life insurance.

Approaching your personal finances with an eye to future is an opportunity – one that can help provide peace of mind through financial security.


1 https://lifehappens.org/blog/women-and-the-life-insurance-gender-gap/
2 https://www.limra.com/en/newsroom/industry-trends/2020/limra-individual-life-insurance-ownership-up-slightly-in-canada2/
3 https://www.americanprogress.org/issues/women/reports/2019/05/10/469739/breadwinning-mothers-continue-u-s-norm/
3 https://www.pewresearch.org/fact-tank/2019/06/20/u-s-women-near-milestone-in-the-college-educated-labor-force/
4 https://www150.statcan.gc.ca/n1/pub/89-503-x/2015001/article/54930-eng.htm
5 https://ourworldindata.org/why-do-women-live-longer-than-men
6 https://lifehappens.org/research/life-insurance-is-on-peoples-minds/
7 https://www.limra.com/en/newsroom/news-releases/2021/2021-insurance-barometer-study-reveals-common-misconceptions-that-prevent-americans-from-getting-life-insurance-they-know-they-need/
8 Loans can be taken if the certificate is in effect and has a positive cash surrender value. Loans will reduce the death benefit and cash values and may affect how long the certificate is in force. Interest is charged daily at the contractual loan rates. Death benefit payable is net of the outstanding certificate loan amount(s) (including accrued interest). If the loan amount exceeds the cash value plus the present value of PUAs and dividends on deposit amount the certificate will terminate

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