U.S. Households Without Life Insurance Reaches 50-Year High

August 29th, 2010

New data from industry-funded research firm Limra has revealed that nearly a third of U.S. households have no life insurance coverage. According to the firm, this is the highest percentage of households going without insurance in five decades.

Millions Are Uninsured

The report found that about 35 million (about 30 percent) U.S. households are without both their own life insurance policies and a policy covered under their employer-sponsored plans. This number is up from 24 million (or 22 percent of households) in 2004.

With only slightly over two-thirds of households having coverage, the percentage is a considerable drop from the over 80 percent of households that held coverage in 1960.

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Tags: High, Life Insurance

Consumers May Mistakenly Believe Life Insurance Accounts Are FDIC-Insured

August 11th, 2010

The Federal Deposit Insurance Corporation (FDIC) recently revealed concerns that consumers may mistakenly believe their life insurance accounts are FDIC-insured. This concern came in the wake of recent media reports that the life insurance industry may be holding onto money due to beneficiaries rather than issuing them lump sum checks because the interest rates they earn are higher.

Life Insurance Companies Subpoenaed Over Beneficiary Accounts

Recently, New York Attorney General Andrew Cuomo subpoenaed a number of life insurance companies, including Prudential Financial Inc., MetLife, Guardian Life Insurance, New York Life Insurance Co., Genworth Financial Inc., Unum Group and Northwestern Mutual Life Insurance in order to investigate their life insurance policy records.

The normal practice after a policyholder dies is for a life insurer to place money into a retained-asset account, which earns interest that can be withdrawn at any time.

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Tags: Accounts, Insurance Accounts, Life Insurance, Life Insurance Accounts