Life Insurance Goes Mainstream at Costco and Walmart Locations

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The life insurance industry has found an innovative response to the unmet need for life insurance in the country. Many Americans spend so much time worrying about what type of coverage to get that they fail to follow through with purchasing even a simple policy.

Importance of Life Insurance Type is Minimal

Writing for USA Today, CNBC’s Jennifer Woods discussed life insurance with financial planning expert Clark D. Randall of Financial Enlightenment. Randall stressed that the type of life insurance consumers choose is much less important than having insurance coverage itself.

“I’ve delivered many death benefit checks, and I’ve never ever had a beneficiary ask what type of insurance it was,” Randall told Woods. “They always ask, ‘How much is the check?'”

With tightening budgets, consumers are focusing on this week’s finances more than long-term financial concerns of those who depend on them. Life insurance companies are bringing insurance to consumers instead of waiting for them to seek it out. One example is at Costco, where in April 2012, consumers gained the ability to buy life insurance right along with the discounted products they already browse shopping aisles for.

Wal-Mart Stores Inc. soon followed suit with its own pilot life insurance program, teaming up MetLife, selling prepaid life insurance in approximately 200 Walmart stores throughout Georgia and South Carolina. South Carolina newspaper The State reports that 3 in 10 Americans don’t have life insurance.

Buying Life Insurance Encouraged by Greater Visibility

Although it’s not clear exactly how many Americans have dependents who would benefit from life insurance, any financial planner will stress that too many people forego this vital financial planning tool.

MetLife told The State, “More people want to be on sound financial footing, we believe, and there are too many barriers [to buying life insurance].”

Making life insurance available at mainstream retailers, like Costco and Walmart, is a smart move for the industry that will likely benefit consumers. By bringing the need for life insurance to the forefront, more consumers are likely to buy the coverage they need.

(Photo: Fan of Retail)