With the full impact of the pandemic in the crazy year that was 2020, LIMRA’s 2020 sales data shows just how life insurance was affected:
2020 individual life premium falls 3%
Yet Term life saw large growth, in terms of policies, up 7%
2020 pushed protection and other financial issues to the forefront as indicated in the statistics above, with many realizing the need for life insurance or for an increase to their current coverage. We are still seeing this growth continue (in certain products) as MIB highlighted ytd activity up 10% though Q1 and part of Q2.
Companies felt the pain of a real-life business continuity plan scenario. Many realized that “keeping the lights on” wasn’t the only issue, but how did they conduct business and keep sales coming in the door when most face-to-face interactions were on hold? The degree to which carriers made progress on their digital transformation was on full display, with many scrambling to build ad-hoc capabilities. With insurers digital strategy (or lack thereof), fully exposed, one critical area stands out above all others – the customer experience is king.
Growth in term sales during the pandemic reflects a newly empowered life purchaser. How do we, as an industry, keep meeting our current and future policyholders where they want to be met? Are we starting to see a shift from a “sold” to a “bought” perspective? What about inforce policyholders who are more digitally savvy than ever before? Say it again with me – the customer experience is king!
Life Insurance has long lagged other sectors in terms of capabilities and services, yet our customers, both consumers and distribution, expect more from carriers than at any other point in history. Whether your distribution is captive or independent, they are more and more savvy than ever before. And finally, some of the generational shifts that LIMRA has long been predicting are really starting to be seen.
The overall flux in the life insurance industry requires a sound strategy to tackle the issues at hand. Elevating the experience for policyholders and distribution through streamlined e-application and illustration software will positively impact the front-end experience for both agents and their clients. Having a flexible, digitally enabled policy administration platform presents an entirely new in-force policyholder experience – allowing carriers to meet their policyholders where they want to be met.
The key is finding a vendor who can make the myriad of transformative needs feel aligned and in sync. We just might know someone.
Stay tuned for Part 2, which will focus on how carriers can build capabilities, change the experience we just talked about, and do so at scale.
Learn more about our life insurance administration systems.