A new report by Capgemini and LIMRA reveals that the life insurance industry faces a significant challenge in attracting and retaining younger customers. The “World Life Insurance Report 2026” highlights a disconnect between traditional life insurance offerings and the evolving financial priorities of individuals under 40, despite a majority (68%) recognizing its importance. The report emphasizes the need for insurers to adapt their products and communication strategies to resonate with this demographic.
The study, which surveyed over 6,100 individuals aged 18-39 across 18 global markets, indicates that younger consumers are delaying or forgoing traditional life milestones that typically trigger life insurance purchases. Specifically, 63% of respondents have no immediate marriage plans, and 84% of both single and married individuals are not planning to have children in the near future. This shift in life priorities necessitates a re-evaluation of the value proposition of life insurance for this demographic.
Despite these changing life patterns, the report notes that younger generations anticipate inheriting significant wealth, averaging US$106,000 per person. Life insurance and annuities are considered important investment vehicles for these funds, ranking third behind stocks and cash savings, with 40% of respondents under 40 prioritizing them. This suggests a potential opportunity for life insurers to position their products as a valuable component of inheritance planning.
The report points out that younger consumers seek immediate gratification and accessible benefits throughout their lives, features often lacking in traditional life insurance policies. A significant portion (25%) reject life insurance due to confusing processes and complex jargon, hindering their ability to understand and utilize the policies. This underscores the need for simplified and user-friendly insurance products and communication.
To bridge the gap, Samantha Chow, Global Leader for Life Insurance, Annuities and Benefits Sector at Capgemini, advises life insurers to demonstrate value beyond traditional death protection by incorporating tangible, near-term benefits that customers can access during their lifetime. This includes deploying innovative products and communicating their value in ways that resonate with younger policyholders. Bryan Hodgens, Senior Vice President and Head of LIMRA Research, also emphasizes the need to address price misconceptions and competing financial priorities.
The report identifies several barriers to purchasing life insurance among younger consumers, including a perceived misalignment with their current stage in life (32%), high premium costs (28%), and a lack of immediate benefits (25%). These findings suggest that insurers must offer “living benefits” that cater to the evolving needs of younger adults, such as wellness rewards for healthy behaviors and coverage for fertility treatments.
Another key finding is the desire for portable life insurance policies that are not tied to employment. While 44% of employees with group policies seek coverage that remains with them when they change jobs, only 19% of life insurers currently offer this option. The report highlights the need for simplified conversion processes to facilitate portability and retain long-term customers.
The report emphasizes the importance of technological capabilities in attracting younger consumers. A significant majority (59%) of under-40s desire direct digital engagement, yet only 31% of insurers offer the necessary platforms. Furthermore, 77% of consumers expect comprehensive, data-driven recommendations, while only 16% of insurers provide them at scale, primarily due to outdated legacy systems. The report recommends that life insurers focus on channel innovation and technological transformation to meet the demands of the next generation.
