The COVID-19 pandemic has done many cruel and terrible things, but it has increased U.S. consumers’ interest in life insurance.
Susan Neely, the president of the American Council of Life Insurers (ACLI), talked about the effect of the pandemic on life insurance sales earlier this week, at a webinar organized by the National Association of Insurance and Financial Advisors (NAIFA).
“Anecdotally, we’re hearing there’s a 30% to 50% increase in the sale of life insurance policies at this time,” Neely said.
- A link to a recording of the NAIFA webinar is available here.
- An article about IRI’s ideas for helping retirement savers is available here.
Neely said LIMRA, a major life insurance industry research organization, is still gathering the official life insurance sales data for the second quarter of 2020.
Life insurance market reports from the period right after the 1918 influenza pandemic show that the amount of in-force life insurance increased 46%, Neely said.
The Wall Street Journal recently ran an article about low interest rates, stock market turmoil, and concerns about the effects of COVID-19 on health and longevity have caused some insurers to suspend sales of certain products and product features.
Neely said ACLI member are simply trying to understand the risks they face.
“We want to provide these protection products,” Neely said. “We want them to be as available as possible.”
COVID-19 is showing that America needs stronger safety-net programs, and that may create opportunities for private insurers to help provide that safety net, Neely said.
NAIFA, a group that represents about 25,000 financial professionals, organized the webinar partly to highlight its own members’ role in helping clients with financial security needs.
Kevin Mayeux, NAIFA’s chief executive officer, talked about the need to modernize.
The current situation “does provide us with a lot of opportunitie to modernize,” Mayeux said.
Videoconferencing system does provide a great way to check on clients.
“You’re talking to your camera, your microphone, and you feel that connection,” Mayeux said. “You know [agents] are able to sit back and check in with somebody instead of being across the kitchen table from them, or in the conference room in their office.”
Kenneth Bentsen Jr., the chief executive officer of the Securities Industry and Financial Markets Association (SIFMA) , said he hopes many of the “temporary changes” regulators are making in response to the COVID-19 stay-at-home rules will lead to permanent changes in some financial services rules.
“This kind of underscores some of what my colleagues might consider 19th and 20th century rules, around things like physical securities and mail delivery and the like,” Bentsen said. “Very important, but, nonetheless, not necessarily built for this environment.
Wayne Chopus, the chief executive officer of the Insured Retirement Institute, talked about the importance of advice from live human advisors.
“Consumers are always going to need personalized financial advice,” Chopus said. “It’s not that some of the robo models aren’t good for some, and in certain situations. But, when you combine a health crisis and an economic crisis together, I don’t think there’s a substitute for the value of the advice that an advisor can give.”
Chopus also talked about the value of trade associations.
“A lot of executives say there is no substitute for the networking and in-person aspect,” Chopus said. “While there are a lot of benefits to doing a meeting as we’re doing this now, having a coffee with somebody at a meeting, I think, still leads to some of the best dialogs and produces some of the most productive outcomes.”
— Read NAIFA Adds COVID-19 Support Program, on ThinkAdvisor.