In the first nine months of the year, 68% of all life insurance applications received by Luminor Bank in Latvia were from clients of this age group, and two thirds of them were men.
“We have noticed that significant life events give rise to a sense of greater responsibility towards relatives, which leads to the decision to purchase life insurance. The clients most often think about life insurance when the child is born, house is purchased, marriage is concluded, or they have to go through the loss of the relative,” says Yekaterina Zinicha, Head of Development at Luminor in the Baltic States.
She notes that clients often purchase life insurance offered by a bank when they take out a mortgage. “People want to make sure that if something happens to them, the family will be protected and they will not have to worry about paying off the mortgage. Most or 80% of clients prefer to insure life for the loan amount, so that in case of unforeseen event with the borrower, the loan obligations are covered, and relatives are released from them. In some cases, the coverage amount is even higher if clients want the family to have a financial cushion equal approximately to the annual income, which would make it easier to adjust in the event of the income decrease. Like building the savings, life insurance is also the basis for the formation of a stable family budget,” explains Y. Zinich.
The average life insurance coverage among millennials reaches 55,000 euros, and the highest coverage amount is almost 220,000 euros. According to the data by the insurance company ERGO, the benefits paid are most often used to pay off loan obligations and stabilize the family budget.
Photos are from open sources.