2022 will be an interesting one for the life insurance industry. This statement comes from Mark Robinson, the Founder and the Managing Director of Albion Forest.
Mr. Robinson points out that when people hit hard times, often the life insurance direct debit is the first one to go. However, with the nature of the ongoing pandemic and the threat to our lives this year, he thinks it is more likely people will shop around, and downgrade to cheaper options whilst maintaining their cover.
In terms of the industry itself, he doubts it will have much impact on the questions providers are asking. It certainly has not so far, with the exception of adding a few ‘have you had COVID-19’ style questions. If you have had coronavirus recently, then you may be required to wait before applying.
It also goes without saying that insurance for other industries, such as in logistics, are equally as important today–in terms of overall coverage–albeit from a different perspective. Strong Tie Insurance underlines the benefit of combining individual policies into a single unit to come up with a sort of fleet auto insurance. This, in turn, creates a more efficient and more comprehensive insurance of those in the commercial trucking business. In more ways, this is part of many insurance companies’ mission to provide excellent customer service.
This is just one facet, a piece of the pie so to speak, of a multi-billion-dollar insurance industry. By looking at the bigger picture—one that does not necessarily involve the ongoing global health crisis—we will see a common denominator in the ever-evolving world of life insurance: customer experience.
To understand more about this, we have interviewed Duncan France, a business and financial services expert, who also happens to have an insurance service website called Duncan Cares. According to Mr. France, there have been significant movements that are taking shape in the life insurance industry even before 2020 ended. These trends—particularly those that focus on the aforementioned customer experience—will only look to continue this 2022.
Trend #1: Better Trained Life Insurance Agents
Customized conversations and better trained life insurance experts will take the spotlight this year, as companies become increasingly focused on financial services to become a “full-service company” to better serve their customer base. Many people have life insurance but cannot tell you what they have, why they have it, or how much they actually need. This, at the end of the day, should not be the case.
A great life insurance agent, who has gone through proper training, will not only make these things clear to their customers during a conversation, but engage in a way that walks them through a total Life Needs Analysis. That way, they can truly determine the need and the budget, as well as factor in things such as planning for retirement. A complete understanding of a person’s financial picture will help a life insurance agent make better recommendations that will best suit their consumers’ needs.
Trend #2: Increased Focus on Retirement and Living Benefits
Life insurance seems fundamentally simple, if the worst should happen with a policy in force, your respective beneficiaries will be paid out a tax-free lump sum of money, which would hopefully cover all of your expenses and leave some money left over for your loved ones. However, every situation is different.
In essence, a well-trained life insurance expert should put together a life program for you that meets a variety of needs and fits your budget. Fortunately, with the advances in modern medicine, people are living longer than ever with substantial jumps in life expectancy every decade. The problem with this is that planning for a traditional retirement becomes nearly impossible. This is where life insurance comes in.
The main problem we see is people outliving their money, whether it be a pension, 401k, IRA, or other self-guided or company-funded retirements. Many people sit on their remaining assets for fear of leaving loved ones with debts, funeral expenses, and medical bills, and this is an unfortunate reality of delayed planning.
A permanent life policy can provide people access to emergency cash, and some can even help assist with long term care needs. At the very least, it will provide customers with the peace of mind that will allow them to enjoy their hard-earned money in retirement while also knowing their loved ones are taken care of.
Trend #3: More Technological Innovations in Underwriting
With the ever-increasing digital health data, companies are able to tell as much (or more) from doctors notes and customers prescription history as they are from a full physical exam. This is leading to more of a digital underwriting process (especially with the onset of the pandemic) on certain policies, depending on the age of the individual and the size of the policy.
Life insurance companies are becoming better at determining whether something is a major red flag or simply a blip on the radar, and whether or not it merits further digging into before issuing the policy. The information available to both customers and companies regarding the life insurance process has never been greater.
Trend #4: More Personalized Experience
In my office, we have a systematic program to reach out to every single client every six months, as customers’ needs are always evolving and major life changes often occur (such as the birth of a child, buying a new home, a marriage, etc.).
An excellent life insurance agent should be proactive in their discussions, and honest with their customers about when they should start thinking about life insurance, and what best suits their needs. Who wants to wait on hold for a call center to speak to someone they do not know to discuss something as personal as life insurance after all?
We want to know our customers and treat them like a member of their extended family. In the age of digital answering machines and robot telesystems, we want our customers to know they can always call our office and get a live person they know and that knows them right away.
You are not just another policy number; you are a human being, and we want to provide everyone with a personal experience. A more personalized life insurance is coming back in a big way, as people are looking for someone that has their best interests in mind and will be available to answer any questions or concerns.