Workplace Life Insurance Hits New Heights in 2024 — But Are We Asking the Right Questions?
Workplace life insurance just set a $4.5 billion record — but are we mistaking volume for value?
Workplace life insurance sales hit an all-time high in 2024, marking the fourth consecutive year of growth, with total new premiums reaching $4.5 billion, an 8% increase over 2023. At a glance, this is a win for both insurers and employees. But under the hood, there are deeper currents financial professionals should be dissecting.
Let’s be honest: this is more than a feel-good stat. It’s an industry signal. And for advisors, agents, and planners, the real question isn’t how much is being sold—it’s why and what now?
Term Life Is the Titan — But Should It Be the Only One?
According to LIMRA, term life makes up more than 80% of workplace life insurance sales, and in 2024 alone, term life premiums rose 13%. That’s a tidal wave of growth in a product that’s affordable, easy to understand, and simple to offer—but also one that often lacks portability, expires when employment ends, and leaves no lasting financial asset behind. But simplicity doesn’t always equal sufficiency.
Term life doesn’t follow you when you switch jobs. It doesn’t accumulate value. It doesn’t support long-term goals like tax-free retirement income or estate liquidity. Yet too many employees assume it’s “enough.”
If financial professionals aren’t positioning workplace life as part of a layered protection strategy, we’re letting clients overestimate their security—and ultimately, leaving families exposed.
Participation Is Up, But Provider Count Is Down — What's Driving the Discrepancy? — Red Flag or Refinement?
Here’s a nuance: employee participation is up 9%, yet the number of employers offering coverage is down 1%. So we’re seeing deeper engagement within fewer organizations.
That could be a sign of more robust benefits packages or smarter enrollment strategies. But it might also reflect broader economic forces—like smaller employers struggling to compete, or regulatory burdens causing drop-offs in coverage.
Advisors serving the small business market should view this as a wake-up call. There’s a widening benefits gap that only intentional outreach, flexible group products, and education campaigns can bridge.
The Retention Opportunity No One’s Talking About
In a labor market where turnover is the norm, group life insurance is emerging as a retention lever. But are employers and advisors truly leveraging that potential?
We need to reframe workplace life insurance as a career-continuity conversation, not just a death benefit. How do we make portability easy? Are we bundling conversion options or offering voluntary permanent coverage as a supplement? These are the practical tools that turn short-term coverage into long-term loyalty.
One midsize tech firm recently paired its basic group term plan with an optional IUL buy-up—and saw 63% employee opt-in. Why? Portability, cash value growth, and optional LTC riders spoke directly to multigenerational employee needs.
Three Moves for Forward-Thinking Advisors
One real-world example: A benefits advisor working with a regional healthcare provider ran a simple audit during open enrollment and uncovered that over 60% of employees had never updated their beneficiary designations. By repositioning the group life discussion and introducing a voluntary whole life policy with living benefits, the employer saw a 40% increase in employee participation and dramatically improved employee financial wellness scores within one year.
Reposition the Conversation: Don’t let group life be the end of the discussion. Use it as a springboard to talk about legacy, liquidity, and long-term financial resilience.
Audit for Gaps: Run the math. Is the client’s group coverage really covering 7-10x income? Probably not. Is there spouse or dependent coverage? Is it portable?
Promote Voluntary Buy-Up & Hybrid Solutions: Carriers are offering innovative add-ons, from LTC riders to conversion privileges. Advisors should treat these options not as extras, but essentials.
Celebrate the Milestone. Then Do Better.
Yes, we should celebrate the growth of workplace life insurance — it reflects rising awareness and a desire for protection. But we can’t stop at the sale. This record year is only a true success if we use it as a platform to educate, upgrade, and personalize coverage for every working American.
Workplace life insurance is booming. Let’s make sure the benefits boom with it.
If you're an advisor, it's time to revisit your group life strategy. Don’t just deliver coverage—deliver clarity, customization, and continuity. Subscribe for more insights, drop a comment with your thoughts, or reach out to collaborate on smarter group solutions.
