Boomers’ life insurance adequacy pre & post the 2008 financial crisis

Abstract

The baby boomers represent a large percentage of the U.S. population and their preparation for retirement, or lack thereof, can affect the economy at large. In light of the 2008 financial crisis, boomer households may be delaying retirement, choosing to work longer. Using the 2004 and 2010 Survey of Consumer Finance, logistic regression analyses are used to examine life insurance adequacy among boomers before and after the financial crisis of 2008. We find a significant difference in 2010 between the baby boomers and the senior generation in life insurance adequacy. Variables related to net worth, such as income, marital status, and self-insurability, were significant predictors of life insurance adequacy. Given greater life insurance adequacy among those with higher income, increasing group term insurance may help mid to low income households. Further implications to practitioners, agents, and educators are discussed.