Black-White Differences in Life Insurance Ownership Among Middle-Income Couples

Abstract

It is well-documented that Blacks have a significantly lower amount of wealth than Whites, which carries a variety of implications. Although there are many historical reasons for the wealth gap that are not easily solved, positive financial behaviors can help Blacks strengthen their financial position, grow their wealth, pass along assets to the next generation, and assist in mitigating financial risk, particularly owning life insurance. Examining life insurance will provide insight into racial ownership differences and will show the extent to which Whites and Blacks are protecting their income. In addition, it will shed light on Blacks’ risk as it relates to life insurance. Two research questions are addressed: (1) Are there racial differences in life insurance ownership? (2) Are there racial differences in the proportion of human capital insured?

Keywords: Life insurance, race, disparities, human life value, Survey of Consumer Finances, human capital

JEL Classification: D14, G22, J15