Majority Of People In Calgary And Alberta Need More Life Insurance Protection
If you live in life insurance you know about the booming economy. Even with the crash in oil and gas prices in 2008, the unemployment rate here remained lower than the Canadian national average. Our average incomes remained the highest of all Canadian cities. The future looks bright for Calgary and Alberta. The Conference Board of Canada predicts that by 2011 Alberta will once again be the economic engine of Canada, and Calgary will be its business mecca.
With all this prosperity and a promising future, you would think that financial planning and risk management would be a priority for the average person in Alberta and Calgary. But, when it comes to insurance planning, Calgarians and Albertans are drastically under-insured.
Lowest life insurance coverage in Canada
The Life Insurance Marketing Research Association (LIMRA) reports life and health insurance ownership statistics. The 2009 report showed Calgary as having one of the lowest ownership levels of personal life insurance in all of Canada. Only 50 per cent of Albertans own insurance (Calgary would have similar stats). Compare this to a national average of 55 per cent (and this is not adequate risk protection for Canadians), and provincial averages like Ontario at 59 per cent and Quebec at 63 per cent. The average sized life insurance policy in Alberta is $325,000. To cover just the 5 per cent insurance ownership gap to bring Alberta to the national average, over $40 billion of life insurance would need to be purchased!
You might think that all the uninsured people don’t really need life insurance policies because they have coverage through a group benefits plan at work. If you were to combine life insurance ownership with those that have some life insurance through work, only 76 per cent of Calgarians and Albertans have any life insurance coverage. That means almost one in four people in Calgary are walking around with no life insurance at all! And many of these people have financial obligations like families, mortgages and other debts.
Why the lack of coverage – are people in Calgary and Alberta cheap?
People in Calgary or anywhere in Alberta are not cheap. They are not more willing to take risks and roll the dice with their family’s future than anyone else in Canada. From my experience, when giving insurance advice to clients in Calgary and Alberta, I find them to be very willing to spend money on personal risk protection plans that make sense to them. The fault lies with the Life Insurance Industry in Alberta.
There are a number of factors contributing to the general lack of life insurance sales in Calgary.
• The average age of insurance advisors in the province is now 57 years old. Many of these agents have built a good book of business and are living off the renewals from old insurance policies. There is no motivation to continue to find new clients and prospect for a new sale because they are heading into their retirement years.
• Not enough new advisors are entering the business, and there is a general lack of support when they start, leading to an 85 per cent failure rate of new insurance agents entering the life insurance industry.
• Many successful agents are focused on the high net-worth clients in Calgary, spending their time and money wooing these clients and fewer resources on the average, middle income Albertan.
• Banks in Alberta have started to sell life insurance through call centres or insurance kiosks, offering creditor/mortgage insurance or cheap term life insurance, and generally offering no in-depth insurance advice. People dealing with banks for insurance coverage are usually also under-insured for their needs.
It comes down to a lack of brokers across the city and the province. There just aren’t enough advisors in Alberta and Calgary, having enough quality conversations with average people, discussing their personal life insurance and risk management needs. It will become even more difficult to find qualified help as the group of aging insurance brokers begin to exit the industry and release their existing clients. A qualified agents with some years of experience giving credible advice will become very hard to find. Even today, there are not many brokers who are willing to take on the average Albertan looking for basic risk protection.
Life Guard Insurance is here to help
At Life Guard Insurance we believe in protecting you from whatever life can throw at you. Risk management is job one, and if you are able to invest, we build long-term cash value into your life insurance policies. We are focused on providing solutions to all Calgarians, from the middle income family to the oil and gas executive. If you are interested in life and health insurance advice from a team with over 45 years combined industry experience and a dedication to our clients, talk to us. We can help.
For a free, no obligation review of your insurance portfolio, please contact us. We would love to help you.
Office (403) 209-3800 ext. 224
Cell (403) 680-7730
http://life-insurance-calgary.com