Why life insurance is the perfect gift this Mother’s Day

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Life insurance is an important piece of protecting every family’s financial health. Yet, not enough women seem to have it. In fact, 54 million women report they either don’t have enough coverage or they don’t have any coverage at all, according to the 2024 Insurance Barometer Study. The study, an annual look at the perceptions, attitudes, and behaviors of insurance consumers, is produced by LIMRA, a research firm backed by the insurance industry, and Life Happens, an industry non-profit.

To discuss the importance of life coverage for all women and how mothers can ensure their families are adequately financially protected, Insure.com spoke with Karen Terry, assistant vice president and head of LIMRA insurance product research. A lightly edited version of the conversation follows.

You can read more about why mothers need life insurance here.

Insure.com: Why do mothers need life insurance?

That’s an important question. Women historically are more likely than men to be underinsured and this year the life insurance need gap is at the highest level that we have seen in the past 14 years. We all know that moms do a lot! While nothing can replace the love and care moms provide, life insurance is a way for mothers to help ensure their children are supported throughout their childhood if the unthinkable happens. 

Life insurance will replace a working mother’s income, which may allow their partner to keep the family home, continue saving for college and pay for childcare and work around the house, such as daycare, housekeeping, and more. It can also make it possible for the surviving parent and caregivers to take time off work to help the children through the grieving process.

Insure.com: Do mothers who are employed outside the home and mothers who are not employed outside the home (full-time caregivers) need the same amount of life insurance coverage?

Every family’s situation is different. It’s easy to put a dollar value on the income that a working mother contributes to the household. However, we all know that being a parent involves plenty of work outside of the traditional workplace. While full-time caregiver moms may not have an income to replace, they provide care that someone else will need. 

Mothers are caregivers, so while the kids are young, daycare is a potential added expense for surviving parents. Moms also clean the house, transport the kids to and from activities, do yard work, maintain family schedules, cook and shop for meals — the list goes on. Replacing all that work will be costly.

It’s also important for working mothers to take all of this into account when determining what and how much life insurance to buy.

Insure.com: Life insurance is complex — it’s not one size fits all. How can moms ensure they get the right coverage for themselves and their families?

It is complex, and according to LIMRA research, uncertainty about what type of insurance or how much to buy is one of the top reasons women don’t have enough life insurance. We recommend that moms work with an agent or advisor. Together they can discuss the family’s financial needs and what she can afford.

Insure.com: How much should mothers expect to pay for life insurance?

There are many factors that impact life insurance premiums for moms— how much coverage and the type of insurance she buys, as well as a person’s age and health. In general, it’s less expensive to buy insurance at a younger age because the cost goes up as we grow older or develop health issues.

Cost is the number one concern when buying life insurance, but life insurance may not be as expensive as you might expect. In the 2024 Barometer Study, only about a quarter of respondents correctly estimated the cost of a 20-year, $250,000, level-term life insurance policy for a healthy 30-year-old. Most overestimated the premium by more than double the actual cost.

Insure.com: What considerations should primary caregivers consider when including life insurance in their financial plan?

Primary caregivers should consider all the financial needs they would need to cover, including their salary and all of the other costs and responsibilities we mentioned before. 

Think about what you want to accomplish with your life insurance benefit. Do you want to cover expenses and give the surviving caregivers a financial cushion to take some time off during the grieving process? Do you need to fund college savings or leave an inheritance for your children? Also consider whether these are temporary — like a mortgage or car loan — or more long-term needs, to determine how long coverage should last.

Think about what you can afford to pay and talk to a financial professional about how to bring all of this together in a plan that works for you and your family.

Nupur Gambhir

Managing Editor

 

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Nupur Gambhir is a content editor and licensed life, health, and disability insurance expert. She has extensive experience bringing brands to life and has built award-nominated campaigns for travel and tech. Her insurance expertise has been featured in Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker, The Financial Gym, and the end-of-life planning service.

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