Life insurers are approaching a new era that requires a “revolution of thought” by its leadership to provide more solutions to more people, according to Dirk Kempthorne, president and CEO of the American Council of Life Insurers (ACLI).
This was the underlying message in Kempthorne’s “President’s Perspective” address to ACLI members attending the ACLI Annual Conference in New Orleans, Oct. 27-29.
Kempthorne pointed toward the lack of savings plaguing many Americans and underserved markets as primary reasons why the industry needs “to reintroduce ourselves to a generation of Americans who may have never met a life insurance agent or a financial advisor, who have never been encouraged to think about long-term financial planning.”
The consequences of failing to meet this challenge, Kempthorne said, would be even more reliance on government entities that are not well-positioned to help.
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“The public has little appetite for states providing retirement plans for private sector workers,” he said. “But, if they perceive the private sector as void of ideas or solutions, the public will take a government solution. If government is the only guarantor of people’s retirement security, government treasuries can be strained to a breaking point. People must know what we can offer, what we can do for them.”
Whether they realize it or not, Kempthorne said Americans are desperate to hear from the industry. “This is the generation of 9/11 and the financial crisis,” he said. “They have learned that life is unpredictable. They will welcome our guarantees. But please keep this in mind… absent a strong message from us, they will hear a strong message from government about the guarantees it offers. If we fail to connect with our customers, if Americans look to government and not to us, we will have forfeited an enormous opportunity. And the consequences to the Treasury of this government may be onerous.”
Kempthorne also asked whether the industry is making effective use of new communication mediums like Facebook and Twitter, and how that impacts connections with younger consumers. “Are we gaining the attention of America in ways America understands? Our customers of tomorrow are communicating in a variety of new ways,” Kempthorne said. “We need a new emphasis on communication, simplification and distribution.”