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Industry group highlights life insurance needs of Hispanics

By Maryalene LaPonsie on October 10th, 2013

One industry group says now is good time to consider the life insurance needs of Hispanic individuals and their families.

LIMRA, a global research and consulting organization for the insurance and financial industries, issued a report, Financial Protection for Hispanics, on the subject. In it, the firm notes the Hispanic population is expected to see significant growth in coming years and many within this demographic have financial pressures that could be addressed by life insurance coverage.

Hispanics a 'natural market' for life insurance

In issuing its report, LIMRA called Hispanics a 'natural market' for life insurance.

"While the Hispanic population is complex -- they come from many countries -- they share a tendency to be young, with large families including children and extended family members," said Nilufer Ahmed, senior research director for LIMRA Insurance Research, in a written statement. "Their strong emphasis on family makes them a natural market for life insurance."

In addition to having a strong sense of family, many Hispanics are extremely concerned about being able to provide financially for their loved ones. LIMRA found 62 percent of less acculturated Hispanics and 51 percent of more acculturated Hispanics are either very concerned or extremely concerned with the prospect of becoming disabled and being unable to earn an income. That compares to only 37 percent of the general population who say they are very or extremely concerned about losing their income-earning potential.

With the U.S. Census Bureau estimating the Hispanic population will grow three times that of any other ethnic group, these families may represent an untapped market for the life insurance industry. They may also be in a position to take advantage of affordable life insurance rates since more than half of Hispanic families fall into the middle-income category.

Life insurance offers safety net

Life insurance companies hoping to woo Hispanic shoppers may do so by appealing to their sense of responsibility for their family's financial well-being.

As a flexible product, life insurance can fill more needs than simply paying a death benefit. Whole life policies build cash value that can be used for retirement, housing purchases or any other financial need. In addition, some plans offer riders that allow for living benefits in the event an individual is diagnosed with a terminal illness or should a policyholder require long-term care.

LIMRA suggests life insurance companies may want to take the time to discuss how a plan can fit the needs of a particular family. Since some families are multi-generational and bilingual, the firm advises brokers to ensure that all family members are accounted for during the planning process and steps are taken to overcome any language barriers.

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