Across industries, companies have acted and adapted quickly to meet customers’ needs during COVID-19. Ours is no exception.
The life insurance industry was already undergoing a transformation before COVID-19 hit, but the pandemic created a paradox that underscored the need to accelerate that transformation. While there was suddenly unprecedented demand for life insurance, there were also unprecedented challenges to meeting that demand.
The pandemic also cast light on trends that are likely to fuel our future trajectory. COVID-19 is reinforcing the important role life insurance companies can and should play in society and the value we can offer our customers. More importantly, it has highlighted what we must do to continue to deliver on our commitments in a meaningful and relevant way.
In April, Aite Group reported that mortality claims in the US resulting from COVID-19-related deaths this year could range from $4.8 billion to $7.2 billion.
That is a staggering figure, but more telling than the dollar amount are the people and families behind those claims. At its core, life insurance is personal. In several cases in recent months, the individual who passed away had been a John Hancock customer for 80 years. We have also seen spouses pass just days apart from one another. Those are the moments that give us pause. A claim is not just as a policy number or a death benefit amount, but a person with a unique story. Our job is to process claims quickly and efficiently, without losing sight of the bigger, human picture. The pandemic did not change this, but it did bring it into sharper focus. We need to be there for our customers and their families — real people with real challenges — and fulfill promises we made to them, sometimes decades ago.
While the claims remind us of our essential purpose of fulfilling promises made to customers long ago, this environment also reminds us of the need to serve prospective clients better so that more people can get the valuable protection that comes with life insurance. As people are suddenly much more mindful of their own mortality, they are starting to think, ‘How prepared am I? Would my loved ones be protected if something were to happen to me?’ COVID-19 has underscored the value of life insurance, but the resulting demand only proved that we, as an industry, have work to do. More people want life insurance, but earlier this year we struggled to deliver, handicapped by our own design and social distancing.
Long before COVID-19, we were working hard to change the life insurance sales process — it’s a lengthy, cumbersome one that involves labs, doctor’s visits, documentation and in-person meetings. The pandemic made all those steps impractical, if not impossible. Fortunately, we had already made significant strides toward transforming the buying process in terms of investing in technology and growing our access to electronic health records (EHR) when social distancing became the norm. In some ways the pandemic accelerated our efforts and we have been able to rise to meet the demand. We’ve expanded existing digital capabilities, leveraged electronic signatures, and harnessed new ways to gather pertinent health data. It’s working. The new challenge will be to keep the transformation momentum going when we are able to return to some of our previous ways.