Women and the Importance of Insurance

As women embark on or continue in their professional lives, they also navigate through financial waters. Anecdotally, over the past several decades, women have become more engaged in the workforce financially literate and instances may even be the “CFO” of their households. Many women are now the breadwinner or co-breadwinner for their household¹.

My goal is to emphasize the importance of insurance coverage to women in their professional lives, in addition to financial literacy.

Historical Perspective

Historically, women have not been the primary breadwinners in American households^2,3. From my own experience, women of my generation were not educated by their parents in the finer points of financial management and investments (including the acquisition of insurance assets). So, I ask: are women routinely asking themselves what I consider the most important questions pertaining to insurance coverage? For example, what is appropriate coverage for me from a life insurance perspective? From a disability perspective? How do I become better educated about the myriad of insurance products that are available in the marketplace?

Women's Insurance Market

Women and investing is frequently talked about. Unfortunately, women and insurance is not talked about nearly as frequently. I believe that this topic is vital as the number of households today that are dependent on women’s professional income increases^1,2. Today, women actively contribute to the financial well-being of the American household and, in some cases, can be the sole breadwinner¹.

I encourage women to ask themselves, “Have I adopted a methodical and proactive approach when it comes to acquiring insurance?

Women tend to live longer than men and are therefore more likely to need formal, “paid for” long-term care assistance⁴. As a result, it is crucial for women to prepare for a time when long-term care insurance might be vital to their independence, health and welfare.

A Few Simple Recommendations

I think there are a few simple steps that any woman can take to become more aware of her unique insurance needs and to make certain she and her family are adequately and appropriately covered.

I’d like to note that these steps should be taken in collaboration with a professional financial planner, your employer’s human resources team, or an insurance specialist.

1. Review existing coverage: Understand the details of your current insurance policies. Often, people simply accept whatever coverage is provided through their employer without ever fully understanding the limits of that coverage, or without ever asking whether it is sufficient for their needs I recommend that women take a comprehensive inventory of her existing coverage, know what she really has in terms of coverage, and understand how that coverage fits into her holistic financial picture.
2. Identify your contributions to your household: To ascertain the amount of coverage needed in the event of disability or death, it is important for women to assess their overall contributions to their household. While income protection is critical, it may be equally important to consider any valuable tasks and roles you are responsible for. These vital household tasks can often be disregarded, but when you are no longer able to perform them may cause an extreme burden to the household. This may include any household task performed outside the professional realm. An example is cooking and grocery shopping⁵. Determining your role in performing routine household services can be overlooked but important in considering the kind of coverage and protection you’d like to provide for your family.
3. Develop a plan: In consultation with a financial planner or insurance advisor, I recommend that women develop a plan based on their “what if” scenarios. That is, “if a certain scenario should occur, to what extent would I desire coverage for my benefit, and for the benefit of my family?”

When working to put her plan in place, a thorough review of the products available in the marketplace is both constructive and advantageous for women.

After consideration, some women might find that insurance is not always the answer. However, as a woman, considering insurance in addition to other investment options may be the right choice for protecting the financial stability of her household in the event she is no longer able to provide.

I encourage you to reach out to your insurance professional to look into all options.

¹ https://www.americanprogress.org/issues/women/reports/2009/10/16/6789/the-shriver-report/

² https://www.pewresearch.org/fact-tank/2017/09/20/americans-see-men-as-the-financial-providers-even-as-womens-contributions-grow/ft_17-09-20_spouses_forcouplestoday/

³ https://www.census.gov/library/publications/2017/demo/p60-259.html(Table A-4)

⁴https://assets.aarp.org/rgcenter/il/fs77r_ltc.pdf

⁵ https://www.pewresearch.org/fact-tank/2019/09/24/among-u-s-couples-women-do-more-cooking-and-grocery-shopping-than-men/