Life insurance was something people knew after they had settled down. However, for Gen Z and Millennials, that timeline has been rewritten. They may not have bought life insurance in large numbers yet, but they are thinking about it before and more seriously. Faced with financial pressure, unstable job security, and a digital world that puts everything at your fingertips, young adults are approaching life insurance with fresh eyes. What they are looking for, and what insurance companies need to offer, is changing rapidly.
Generations that navigate financial turbulence
Millennials and Zers did not have a precise, mild economic arriving. From weathering the aftershocks of the Great Recession (2007-2009) to navigating the global pandemic and today’s sustained inflation, economic stress has been a constant backdrop. And for many, it shaped more careful and positive thinking.
Debt and everyday expenses are getting hit faster. Gen Z borrowers currently earn student loan debt with an annual clip of 6.72%. This is the fastest of all generations. At the same time, living expenses are rising rapidly. Compared to millennials of their age, Gen Z spends 31% on housing, almost twice as many car insurance and 46% on health insurance. It’s no wonder that financial buffers like life insurance are beginning to feel less options and more important.
And while food and fuel costs led to a surge in inflation in 2022, that has changed. As of early 2025, shelters became the most important pressure point, with food still in the top three. We have also seen a sudden increase in car insurance and medical care. It is all the core costs young adults face when trying to gain financial foothold. When baseline costs are constantly rising, creating a backup plan for your loved ones starts to feel like common sense, not just financial planning.
What the pandemic taught young adults about protection
The Covid-19 pandemic has not only shaking everyday life. This fundamentally changed how many young people think about the future. Suddenly, the idea that “everything can change overnight” was not theoretical. It was a living experience.
The shift has had economic consequences, especially for Gen Z. Today, one in seven people are at the peak of credit cards, and young adults are facing a higher delinquency rate. There is growing awareness that waiting to plan “someday” may not reduce it.
In this context, life insurance is restructured. It’s not just about preparing for the worst anymore. It is also about protecting the progress young adults are working hard to make. Whether you have a child or a mortgage, many are looking for ways to lock in security for your partner and family. Not because they expect the worst, but because they saw how quickly things change.
Employer benefits aren’t reducing it
Job hopping is much more common among ZZ and millennials than older counterparts, and with this, there is less access to long-term employer benefits like group life insurance. Gigwork plays a big role in this shift. Over 60% of gig workers use their income to complement traditional jobs, with 36% of millennials and 21% of Gen Z’s, gig work is the main source of income.
Because contract work rarely includes benefits like life insurance, many young adults recognize the need to explore individual policies on their own terms.
Life insurance companies are finally catching up
Is there one of the biggest reasons why younger generations have traditionally slowed adoption of life insurance? It was inconvenient and opaque. But it is changing rapidly. Online first providers like:
Currently, we offer fast estimates and turnarounds for applications in just 24 hours. These are two things that resonate with digital native buyers.
A recent Corebridge survey found that 46% of millennials and 40% of Gen Z said they are more likely to buy a policy if approved in 24 hours. With a high-tech forward platform and fastless applications, insurance companies are already beginning to meet young shoppers on their mobile phones.
Cost confusion remains a major barrier
Convenience isn’t the only thing that matters. Affordable prices are equally important. Still, many young adults think life insurance is more expensive than that. A Corebridge survey found that 41% of Americans have confirmed that a 20-year term policy cost of $250,000 for a healthy 30-year-old, and an additional 47% overvalue prices.
That misconception prevents people from applying when they are young and healthy. So, ironically, when the policy is cheapest. As actual pricing education grows, younger consumers may begin to realize how much money they can save by locking to premiums earlier.
Financial influencers have made the once taboo money topic more accessible – life insurance included. According to Limra’s 2023 Barometer survey, 81% of Gen Z and 75% of Millennials rely on social media for financial advice.
Some influencers promote life insurance as an investment tool first and foremost, as well as investment tools, often highlighting cash value components or high-value permanent policies. However, it is important to remember that life insurance is designed to protect your loved ones. It does not replace an investment portfolio. Living for periods is often the most affordable and simple option for younger adults, but permanent policies can be more strongly encouraged simply because they are likely to provide a higher commission to those selling life insurance products.
That’s why it’s important to balance what young consumers have learned on Tiktok and Instagram with guidance from trusted sources and licensed financial professionals.
The Real Voice: Why are Young Adults taking the initiative?
Whether driven by family influences, economic uncertainty, or life change, these decisions reflect a generation that is more aware of the unpredictability of life and the financial ripple effects it may bring.
Nadia’s story reflects the growth trends of young adults. It’s about making aggressive financial moves before big milestones like having children. Family encouragement, combined with the desire to be healthy yet trapped in a low premium, is also a powerful motivation.
Lessing’s experience highlights how life events, like parents, play a pivotal role in life insurance decisions. But what’s shifting is timing and urgency. In a financial environment characterized by inflation and uncertainty, young families may choose to take maximum protection knowing that they know it is one of the few ways to protect the future of their families.
Bankrate asked Brett Anderson, CFP®, CHFC® and CLU®, financial planners with St. Croix Advisors in Minnesota. “Factors to consider are: do you want to provide income losses to your spouse or important other children or children? You may also not have funds for your child’s education, paying off mortgages and other debts, covering final costs, or having all your financial liabilities today,” Anderson said.
Conclusion
Millennials and Gen Z are not just waiting for their lives to pass on milestones. They show signs that they are ready to protect what they have already built. Whether it’s a gig job fuss, whether you want to manage your debt rise or make sure your loved ones aren’t holding your bag, these generations are showing up in life insurance conversations with new priorities.
But the old school way of selling life insurance doesn’t cut it down. If an insurance company wants to acquire their position in the financial lives of young people, they need to rethink the rulebook. There is less red tape and more relevant. This is not to convince them that they need life insurance – most already know it. It’s about proving that the industry is ready to meet along the way.
