How can insurance agents feel optimistic amid volatile global markets, high unemployment numbers and fears that the United States is headed for a double-dip recession?
Present economic worries aside, individual life insurance coverage among American consumers has steadily declined over the past 50 years, according to a 2010 study by LIMRA. Yet life insurance is now more affordable than ever. So why are so many Americans today either uninsured or underinsured?
This was the question we set out to answer in the 2011 Genworth Financial LifeJacket Study: Revealing Insights to Close the Coverage Gap, which was conducted in collaboration with Gregory Fairchild and the University of Virginia’s Darden School of Business in 2009 and 2010. Our research targeted the interests and habits of a demographic we define as “Main Street Americans.” This demographic represents the 70% of U.S. households with a combined annual income between $50,000 and $250,000. Past research has shown this population to have a diverse range of current and future financial needs. This group has also been identified as being the most likely to be engaged in, and responsive to, building a comprehensive financial portfolio, including life insurance.
Following are four simple strategies agents can employ to tap into the unmet life insurance needs of these households:
Milestone Events: Think Beyond “Once-in-a-Lifetime”
Milestone events such as marriage, the birth of a child, starting a new job or buying a home can motivate individuals to seek life insurance coverage. However, there are surprising differences in the time it takes consumers to pursue life insurance coverage after these events. For example, the average consumer waits six months to secure life insurance after beginning a new job, but 15 months after buying a new home. While these transitions create a desire for life insurance coverage, a disparity exists in the time it actually takes for consumers to make these purchases. These transitions should not be viewed as rare and infrequent sales opportunities, but rather as benchmarks that can be leveraged to the present and future needs of the client. There is an opportunity for financial professionals to shorten the timeframe between life transitions and purchases by providing clients greater control in the educational process.
Annual Check-Ins: Bridge the Disconnect