A new LIMRA and Swiss Re study of insurance consumers in China reveals that many insurance buyers like the personal touch of traditional channels but recent trends suggest an increase in online sales.
The report, The Chinese Insurance Consumer, looks at eight different personal insurance products such as, life, individual health, critical illness, etc. and the distribution channels consumers used to purchase those products.
Looking at activity within the last decade, 56 percent of insurance purchases were made through an agent. Banks were the channel of choice for 13 percent and insurers’ websites accounted for eight percent of buying activity.
The past year saw a big shift with 40 percent of Chinese consumers saying they purchased insurance from an insurer’s website. Only 23 percent said they bought from an agent and 13 percent from a bank.
Because direct online sales are still limited in China, researchers took a second look at the sudden growth of buyers who said they purchased directly from an insurer’s website. A buyer’s initial engagement may have involved online activities such as, visiting a company website, requesting a quote or having an agent contact them.
As a result, this experience may have created a perception that the purchase was “online” even when the sale was completed in a more traditional way. While online purchasing has definitely seen a recent increase, two out of the three most popular channels — insurance agents and banks — involve the personal touch.
Men are the majority of buyers from agents and insurance websites at 57 percent in each channel, compared to 43 percent of women.
There is a big difference in the banking channel where 72 percent of women buy from banks compared to only 28 percent of men. The banking channel serves significantly more middle-to-low income insurance buyers than the two other channels.
Life insurance (62 percent) and individual health insurance (17 percent) were the most cited products purchased. When buyers were asked where they first learned about insurance products, 57 percent of life insurance buyers said television was the source, while family and friends were cited most for health insurance at 62 percent.
The “Chinese Insurance Consumer” is part of a larger LIMRA and Swiss Re collaboration in which 6,000 individuals from 12 Asian countries were surveyed.