If you've ever wondered about which states see the most life insurance policy purchases, new numbers appear to confirm what common sense suggests.
The states where the highest amount of life insurance is purchased also have the biggest populations, according to recently released data compiled by SNL Financial and reported by LifeHealthPro.
Most life insurance sales in California
California tops the list, where an estimated $15.1 billion in life insurance premiums were sold in 2014, the latest year for which data is available, LifeHealthPro reported. Second to the Golden State was New York, where $11.2 billion in life insurance premiums was sold two years ago. Rounding out the top five were Texas at $10.6 billion, Florida at $8.4 billion and Illinois at $6.5 billion in life insurance premiums.
With some slight variations, these are also the U.S.' most populous states. California is home to 38.8 million people, according to the latest Census analysis from the government, more than any other state in the country. Approximately 26.4 million live in Texas, the state with the second largest population, slightly over 7 million more than in Florida, where 19.8 million Americans reside. New York and Illinois are fourth and fifth, respectively, at 19.7 million and 12.8 million.
"Florida's population ballooned in 2014, making it the third largest state by population."
Boom in Florida population growth
It's only within the last couple of years that Florida became the country's third largest state by population. The Sunshine State's total number of inhabitants rose by 293,000 on a year-over-year basis as of July 2014, based on data compiled by the U.S. Census Bureau. New York's population grew by only 51,000 over the same period. Prior to 2014, the Empire State had 19.6 million people living there compared to 19.5 who resided in Florida.
In terms of raw numbers, however, Texas has seen the largest growth in recent years. The Lone Star State increased its ranks by approximately 451,300 residents between the summers of 2013 and 2014, according to Census data. California had the second largest numerical increase at 371,100, followed by Florida at nearly 293,000, Georgia at roughly 102,600 and Arizona at a shade shy of 96,500.
ACLI urges states to adopt national standard on unclaimed life insurance benefits
Where people live is not only a fact pertinent to life insurance sales agents, but also the life insurance industry, because when benefits go unclaimed, the proceeds often flow to the states where the policies were in effect.
But the American Council of Life Insurers is trying to change all that so that the benefits go to their rightful owners when family members are unaware that a deceased loved one had a policy.
"Twenty states require life insurers to investigate when benefits go unclaimed."
Dick Kempthorne, ACLI president and CEO, indicated that when life insurance benefits go unclaimed, it's usually because extended family don't know about the policy or are unsure of how to go about finding out. In either case, the proceeds ought to go where they were intended to.
"Life insurers want everyone to receive the benefits to which they are entitled rather than paying unpaid benefits to state governments," Kempthorne explained. "That is why the American Council of Life Insurers has advocated since 2012 for state legislatures to adopt a national standard on the issue.
Forty percent of the U.S. - 20 states - have laws on the books that require life insurance companies to locate family members who are due to receive life insurance benefits from a deceased loved one but haven't. ACLI is hoping that all 50 states will follow suit over the next 18 months.