From Preaware to Ready: What Is Important to Consumers?

December 2025

According to LIMRA’s 2025 Insurance Barometer Study, around 100 million U.S. adults report a life insurance need gap — indicating that they either report needing life insurance or needing more of it. In a study of the life insurance decision-making process, LIMRA classified consumers according to their life insurance decision state (Bateman et al., 2023) from preawareness of life insurance to feeling capable of making purchase decisions. An increased understanding of consumers at different states of perceived readiness — and the factors most important to them when considering life insurance — can be leveraged to increase consumer confidence, trust in the life insurance industry, and likelihood of purchase.

Consumer Readiness

Overall, we found an equal percentage (22 percent) of consumers are either currently looking at different life insurance coverage to decide what to choose or have looked at different life insurance coverage previously but are not yet ready to decide. Who are these consumers, and what is most important to them when considering life insurance coverage?

Consumers most likely to be currently looking and ready to decide what to choose:

• 37 percent of single consumers with children under 18
• 36 percent of consumers with a household income of at least $250K
• 33 percent of consumers between 35 and 44 years of age
• 32 percent of Hispanic consumers
• 32 percent of married consumers with children under 18

Consumers most likely to have looked previously but are not yet ready to decide:

• 30 percent of consumers between 18 and 24 years of age
• 27 percent of Asian consumers
• 26 percent of single consumers without children under 18
• 24 percent of female consumers

Deciding Factors

Consumers rated the importance of pricing, coverage level, aspects of the application process, company reputation, and personal recommendations. Overall, consumers are most likely to consider coverage amount, annual cost, and company reputation most important. However, ratings of importance vary as a function of decision state.

When it comes to coverage amount and company reputation, consumers who have already chosen life insurance coverage and are keeping that coverage (Already Chosen), those ready to choose now (Choose Now), and those planning to choose later (Choose Later) are all somewhat more likely to consider these factors very/extremely important.

This contrasts with consumers who are less familiar with life insurance or less inclined to engage with it — such as those who don’t know what life insurance is or how it works (Preaware); those who believe they know what life insurance is and how it works, but are not interested in learning more about it or how it could benefit them (Aware); those curious to learn more, but doubtful they or their beneficiaries would benefit (Interested); and those who believe they will never choose life insurance or no longer need it (Choose Never). See Figure 1.

When it comes to cost, the Choose Later group is among the most likely to consider it very/extremely important, suggesting that concerns about cost may contribute to delays in decision making. The Already Chosen and Choose Now groups are slightly less likely to consider cost very/extremely important. Notably, these small differences impact product choice.

When consumers selected life insurance products from “menus” that varied by annual cost, face amount, application/underwriting method, consumer star rating, and personal recommendation, those in the Choose Now group were substantially less sensitive to pricing than other consumers who were less capable or less interested.

Overall, consumers were much less likely to consider aspects of the application or policy issue process very/extremely important — with personal recommendation being the least likely to be rated very/extremely important. See Figure 2. However, the Choose Now group was the most likely to consider each of these very/extremely important with the exception of “how you apply.” Notably, 3 in 10 consumers in the Choose Now group consider a personal recommendation from a friend, family member, or advisor very/extremely important.

The shifts in perceived importance that occur as consumers progress toward becoming capable decision makers are indicative of increased knowledge about the life insurance product and process, suggesting industry success in educating its consumers. Those consumers feeling most capable are less likely to believe price is very/extremely important and more likely to understand the importance of factors that can impact the application process or policy issue.

However, when consumers are asked how knowledgeable they are about life insurance, those reporting they are “moderately knowledgeable” are the most likely to fall in the Choose Now group (28 percent). Clearly, consumers would benefit from having much greater confidence when considering life insurance coverage.

Those currently shopping and feeling ready to decide would especially benefit from referrals to independent financial advisors, which could also increase trust in the insurance company. However, much more needs to be done to support consumers who don’t yet feel ready to decide — including 1 in 4 female consumers. An increased understanding of the product and process, including pricing and underwriting options, would help alleviate concerns and move these consumers toward coverage decisions that best protect their families’ financial futures.    

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