People in Calgary & Alberta don’t have enough life insurance!

If you live in Calgary, Alberta you know about the booming economy.  Even with the recent economic down-turn the unemployment rate remained lower than the Canadian national average and incomes remained at the top of all Canadian cities. The future also looks very bright for Calgary and all of Alberta. The Conference Board of Canada predicts that by 2011 Alberta will once again be the economic engine of Canada, and Calgary will be its business mecca.

So, with all this prosperity and a bright future, you would think the average person in Calgary is doing good financial planning and risk management. Obviously they can afford it with the highest average incomes in the entire country. Well, when it comes to life insurance planning Calgary and all of Alberta is drastically under-insured.

Lowest life insurance coverage in Canada

The Life Insurance Marketing Research Association (LIMRA) reports on statistics of life and health insurance ownership. There 2009 report showed Alberta as having one of the lowest ownership levels of personal life insurance in all of Canada. Only 50% of Albertans (and Calgary would be in line with these numbers) own a life insurance policy. This is compared to a national average of 55% (and this does not represent adequate protection for Canadians), and provinces like Ontario at 59% and Quebec at 63%. The average sized life insurance policy in Alberta is $325,000. To just cover the 5% insurance ownership gap to bring Alberta to the national average would mean over $40 billion of life insurance needs to be sold!

You might be thinking that all the uninsured people don’t really need personal life insurance since they have coverage through a group benefits plan at work. If you were to combine personal life insurance ownership with those that have some life insurance through work, you only get to 76% of Albertans with any life insurance coverage. That means almost one in four people in Calgary are walking around with no life insurance at all. And many of these people have families who rely on them and debts to be paid off.

Why the lack of coverage – are people in Calgary cheap?

People in Calgary or anywhere in Alberta are not cheap. They are not more willing to take risks and roll the dice with their family’s future than anywhere else in Canada. From personal experience, when sitting down with clients in and around Calgary I find them to be very willing to spend money on personal risk protection plans that make sense to them. The fault lies with the Life Insurance Industry in Calgary and across Alberta.

There are a number of factors contributing to the general lack of life insurance sales in Calgary.

• The average age of insurance advisors in the province is now 57 years old. Many of these agents have built a good book of business and are living off their existing client base. There is no motivation to continue to build new clients and prospect for a new sale. They are on auto-pilot, heading into retirement years.




• Not enough new advisors are entering the business, and there is a general lack of support when they start, leading to an 85% failure rate of new agents entering the life insurance industry.




• Many successful agents and brokerages are focused on the high net-worth clients in Calgary, spending time and money to woo these clients and they have become disinterested in the average, middle income Albertan.




• Banks in Calgary have started to sell insurance through call centres of insurance kiosks, offering creditor/mortgage insurance or cheap term life insurance, and generally offer no advanced insurance advice. People dealing with banks for life insurance coverage are generally also under-insured for their needs.

It comes down to a lack of advisors across the city and the province. There just aren’t enough insurance advisors in Calgary having enough quality conversations with average people, discussing their insurance and risk management needs. It will become even harder to find qualified help as the group of aging insurance agents begin to retire (or die) and release their existing clients. A qualified insurance agent with some years of experience giving advice you can trust will become very hard to find. Even today, there are not many advisors who are willing to take on middle income clients with limited budgets to put towards insurance premiums.

Life Guard Insurance is here to help

At Life Guard Insurance we believe in protecting you from any and all risks that life can through at you. Risk management is job one, and if budget allows, we build long-term cash value into your insurance policies. We are focused on providing solutions to all people in Calgary, from the middle income family to the oil and gas executive. If you are interested in life and health insurance advice from a team with over 45 years combined industry experience and a dedication to our clients, then talk to us. We can help.

For a free, no obligation review of your insurance portfolio, please contact us. We would love to help you.