About 68% of consumers aged under 40 in Australia and other advanced markets see life insurance as essential but are not acting on it, a report co-authored by consultant Capgemini has found.

Insurers should learn more about this group, because they will be the primary drivers of growth due to their attractive risk profiles, lower claims frequency and wealth-building potential, the report says.

Awareness of life insurance and its importance “isn’t translating into sales at a scale that drives long-term growth and profitability … misaligned value propositions are the primary barrier”.

The report, compiled with the Life Insurance Marketing and Research Association, says many insurers are struggling to reach these consumers, partly because of the common perception that life insurance offers only death coverage, rather than lifelong benefits.

“Carriers need a different playbook when marketing life insurance to the younger generations,” association head of research and senior VP Bryan Hodgens said.

“Our joint research shows that the price misconceptions, coupled with competing financial priorities, position life insurance at a disadvantage with younger adults.

“Carriers must not only demonstrate the accessibility and affordability of life insurance but also need to reimagine the product to address younger adults’ current financial priorities, while adapting to meet their future financial goals as they age.”