Nearly one in five consumers is prepared to buy life insurance through a retail outlet, according to new research.
LIMRA published this finding in a summary of results from its 2013 Insurance Barometer Study of consumers’ attitudes about life insurance, their buying preferences and interest in purchasing life insurance through nontraditional channels. Conducted by LIMRA and the Life and Health Insurance Foundation for Education (LIFE), the survey polled 2,000 U.S. adults between ages 18 and 75 who are the sole decision makers for financial matters in the household.
When asked about their willingness to buy life insurance from a retail outlet — among them a warehouse club store like Costco or a superstore like Wal-Mart or Target — 17 percent of the survey respondents said they would be amenable to doing so.
Among the reasons for their interest, consumers who are willing to purchase at a superstore (7 percent) cite perceptions such as:
- Reasonable cost (63 percent);
- Simple process (44 percent);
- Convenience (43 percent); and
- No pressure to buy (42 percent).
The LIMRA survey notes, however, that buying life insurance from a financial professional remains the "preferred" method, a finding consistent with previous LIMRA surveys.
“While the number of consumers willing to purchase a life product through a retail outlet is not overwhelming, it certainly is worthy of note,” said Todd Silverhart, corporate vice president and director of LIMRA Insurance Research, who spoke about the study at LIMRA’s annual Life Insurance Conference held this week in New Orleans. “In light of the novelty of the concept and that few people have actually shopped for life insurance through a retail outlet, there is likely to be considerable confusion in the eyes of the consumer as to what such a purchasing experience might entail. For carriers seeking a niche market, retail ventures could be a worthy approach.”
Among the carriers pursuing a retail strategy is MetLife. The New York-based insurer unveiled a partnership with Wal-Mart in October 2012 under which MetLife will market pre-paid, one-year term life policies in about 200 Wal-Mart stores in Georgia and South Carolina.
The 2013 study also finds that a large majority of consumers (85 percent) agree that most people need life insurance and 65 percent say they personally need it. However, just 62 percent of consumers indicate they have life insurance coverage today.
Additionally, nearly half of respondents (45 percent) express "some likelihood" (slightly likely to extremely likely) that they would buy life insurance for themselves or a member of their household within the next 12 months.