Most American families have never sat down to discuss life insurance and the assumptions filling that silence are quietly undermining the financial strategies advisors work hard to build.
The data reveals that 78% of families have not had an in-depth conversation about life insurance and while 60% of adult children assume their parents have life insurance in place, only 44% of parents say they do.
The same research found that 78% of families have not discussed retirement income, 80% have not talked through age-related healthcare costs, and 77% have never addressed leaving money or assets behind.
In each case, adult children significantly overestimate how prepared their parents actually are: 59% believe their parents have a retirement funding plan, while only 51% of parents say they do; 55% assume a healthcare cost plan exists, compared with just 38% of parents who say one is in place.
"Families often assume these decisions have already been made, but our research points to a broader issue that when generations aren't talking about long-term intentions or financial priorities, those assumptions leave families feeling unprepared when important decisions arise," said Darrel Tedrow, executive vice president and president of life insurance and retail shared services at Lincoln Financial. "Closing the conversation gap starts with having honest conversations. When families understand their options and priorities, they can make more informed decisions about the role life insurance plays in their long-term financial security."
Lincoln's research identifies a structural impasse. Parents tend to avoid these discussions because they do not want to cause their children anxiety, do not want to confront their own mortality, or feel that complex family dynamics make the topic difficult to raise. Adult children, meanwhile, assume plans are already in place and hesitate to ask questions that might feel intrusive.
The result is that responsibility for starting the conversation sits with no one in particular and so it never happens. The Lincoln data also highlights a generational dimension: Gen X parents who have not discussed these scenarios with their adult children are more likely to report feeling stressed, worried, and unprepared than Baby Boomer parents in the same position.
When a client's family is operating on misaligned expectations, even a technically sound financial plan can unravel at the moment it is needed most such as a health event, a death, or a sudden financial decision made under pressure without the right information.
Documenting conversations is important as family members need to know what decisions have been made, where key information is kept, and how assets and benefits will be handled.
Younger clients are already pushing back on life insurance as a concept, making the advisor's role in reframing coverage conversations all the more important.
The scale of the communication problem Lincoln has identified points directly to an advisory opportunity.
Preparing the next generation for wealth transfers has become a priority for advisors navigating one of the largest intergenerational asset movements in US history. The Lincoln data adds a more immediate layer: before any wealth transfers, families need a shared understanding of what protection is in place.
"Life insurance should be part of a family's overall financial strategy," Tedrow said. "It should be considered alongside saving, investing and preparing for retirement as part of a broader approach to long-term financial security. The most important part of any strategy is making sure the people it impacts understand it. A simple conversation today can create greater clarity and confidence for a family in the future."
Lincoln Financial’s data follows recent data from LIMRA that reveals what life insurance products clients are buying, and what consumers get wrong about life insurance which was explored in a conversation with Bryan Hodgens, head of research at LIMRA and InvestmentNews anchor Gregg Greenberg.
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