Insurance agents are still the preferred way to buy life insurance for many Americans, but they are increasingly turning to direct methods of purchase such as online, phone or mail orders, a survey released Wednesday found.
The survey, “The 2011 Insurance Barometer Study,” conducted by Harris Interactive for LIMRA and the nonprofit LIFE Foundation, found that nearly two-thirds of consumers prefer to buy life insurance from an agent, but that has fallen from 80% in 1996. Today, 26% of consumers prefer to use the Internet, phone or mail to purchase life insurance.
It should be no great shock that the youngest consumers are the most likely to use the Internet to purchase insurance. The survey found that while adults between 25 and 44 were slightly more likely to prefer direct methods of purchase overall (30%), of those, three-quarters prefer the Internet to phone or mail.
While 64% of consumers still prefer to purchase insurance through an agent or advisor, the Internet still plays a role in their decision. Over half of consumers shopping for insurance researched the purchase online, but ultimately bought from an advisor.
“Obviously, the Internet has fundamentally changed consumers’ buying practices over the past 15 years,” Marvin Feldman, president and CEO of the LIFE Foundation, said in a press release. “Recognizing the growing consumer interest to use the Internet to conduct research and buy life insurance, life insurance companies and agents have developed and implemented innovative strategies to engage and serve consumers through their websites and social media platforms that are more convenient for the customer.”
Consumers generally agree that life insurance is important; 86% said that “most people” need it. However, when asked if they needed life insurance, just 70% thought they did and only 63% already owned some sort of life insurance.