Consumers expect insurance purchase to be a retail experience

28 Mar 2017

Consumer expectations are rising. Mega tech companies like Google, Amazon and Facebook increasingly provide personalised customer-centric experience with the data they collect and have raised the bar of service levels, since a lot of people use these sites frequently. Insurers have traditionally adopted tech-enabled client services slowly, and now they need to match not just tech companies, but also other mainstream commercial and retail products and services in terms of service levels, distribution and in particular, transparency.

Life insurance may not be the same type of purchase as clothing or a trip but many consumers want to at least start the buying process online. Research shows potential buyers first go online for two reasons: to gather information before contacting someone in person, or to gather information with high hopes of completing the entire process online.  

There are several factors that consumers feel contribute to transparency. First, they want easy-to-understand terms, and if possible, a glossary. They are also looking for clear and accurate ways to compare companies and products. Consumers also say they want the ability to easily call or chat with knowledgeable sales representatives. Lastly, they are looking for an easy to use online application.

The above findings are according to recent research from LIMRA, which reveals that consumers expect transparency from a life insurance purchase the same way they would for buying other retail products or travel.  

The data from LIMRA‘s focus groups show what consumers want from companies online:

  • Provide transparency. Consumers want the ability to compare companies and products. Transparency is the new normal and helps take the mystery out of life insurance.
  • Offer quotes without restrictions. Consumers want to be able to see product quotes without having to register or provide contact information upfront.
  • Be reachable online and in person. Being able to call/chat with someone is essential. Online chatting is currently optional and consumers are becoming more interested in using it. In addition, an agent locator tool is valuable to consumer so they can quickly find a financial professional.
  • Offer an option for automated underwriting. Some consumers find the physical exam of the life insurance application invasive and prefer an automated underwriting option. Remember to point out if it is a more expensive option up front.
  • Offer online services. Even though life insurance is typically a low service product, consumers expect online services. Some things they want to be able to do online include the ability to change their address, and check policy provisions and payment options.

For more information, refer to Taking Out the Mystery: Providing Transparency for Life Buyers (for LIMRA subscribers).