Consumers under 40 would prefer to receive life insurance benefits as a monthly income – rather than a lump sum payment – according to a study by US-headquartered insurance association, LIMRA.
In a study on life insurance product designs, LIMRA said 4 in 10 consumers under age 40 prefer a monthly income benefit while approximately 30 percent favour a lump sum payment.
Scott Kallenbach, research director, LIMRA Strategic Research, said: "People buy life insurance for income replacement, but most often the benefit is paid as a lump sum.
"Our research suggests that products offering monthly income would have strong appeal among younger and middle class consumers and could be a way to more effectively reach them."
When consumers were asked about a policy that could change with their needs, LIMRA said 7 in 10 expressed interest with one third "very" or "extremely interested" in these flexible products.
Among those most interested, more than half (52 percent) have children and 51 percent already have some life insurance coverage, but believe they are underinsured.
Kallenbach said: "Product design innovations like these may eventually help the industry grow in markets that have proved difficult in the past."
Click on the link below to see how younger consumers want life insurance benefits as income rather than a lump sum.