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Deloitte Survey: Only About Half of Life Policyholders Satisfied with Agent Advice

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Only about half of current owners of life insurance are happy with the advice they received from the agent who sold them the policy, according to a new report.

Deloitte Research, New York, published this finding in a summary of results from an online survey of 1,071 U.S. based life insurance policyholders and 1,000 individuals without life insurance in June 2011. Deloitte contracted with Andrews Research to conduct the survey.

In learning about life insurance benefits, coverage needs, options and costs among current buyers, the report finds that respondents were most satisfied reviewing their employee benefits package (67%), followed by speaking with an insurance agent (59%) and reviewing information packages from an insurance agent.

Satisfaction levels were lower among those speaking with a financial planner (44%) and those either speaking with a bank representative or reviewing information packages received from a bank (36%).

The report finds that more than half (55%) of non-buyers expect to purchase less than $100,000 in coverage. But among those who already have coverage, 62% expect to buy more than $100,000 in coverage, including 32% who anticipate purchasing more than $200,000.

Among current policyholders who had received solicitations, two-thirds (67%) came directly from life insurers, with other sources trailing behind, including agents (37%) and banks (30%). Significant numbers of respondents also reported receiving cross-selling offers from their auto insurers (26%).

Among those who currently have life insurance coverage, the workplace was a prime market for life insurers, as 32% of respondents said they had coverage automatically provided by their employer, while 19% said they bought additional insurance through their employee benefits program. And 9% bought an individual policy from an agent at their place of employment.

When current holders of life insurance were asked about factors that had influenced their last purchase decision, more than 8 in 10 (84%) either strongly agreed (35%) or agreed (49%) that they bought a life policy because the price was affordable.

Among other factors, about one-third of current buyers strongly agreed (14%) or agreed (21%) that they bought life insurance because of advice from a family member, friend or business associate. A similar percentage said they bought due to the recommendation of an insurance agent. Thirty-seven percent noted they were impressed by the brand name, reputation and/or rating of the insurer.