Life Insurance - Finding out what makes consumers tick
May 30, 2012| By Steve Mannik | Life | English
The low interest rate environment, combined with other economic factors, make this a challenging time for life insurers. Not only is it difficult to price business, tough economic conditions are making it hard to find growth. As a result, many carriers have simply quit certain lines of business such as long-term care, annuities and individual life. Others have responded by innovating with new product ideas. Or they have focused more on historically underserved markets, such as voluntary worksite.
At times like this, when you’re trying to make your products marketable and profitable, it helps to improve your understanding of consumer buying attitudes.
Gen Re recently partnered with the Kellogg School of Management at Northwestern University to measure consumer purchasing behavior toward life insurance. Our research found that awareness is a big issue and that potential buyers simply find products too complex. Consumers are often reluctant to spend the necessary time needed to buy the right product. Over half of the Kellogg study participants said that information about insurance products is difficult to understand. In addition, affordability and confidence that claims will be paid are important to buyers when deciding whether to buy insurance. The research also identified several emotional blocks to purchasing insurance, having to do with optimism, risk tolerance and procrastination.
What’s clear is that insurers need to build their company image and earn the trust of their customers now more than ever. Consumers associate words such as “necessary,” “responsible” and “safe” with insurance. Carriers should evaluate their marketing messages to leverage these beliefs.
Read The Bulletin, to find out more on consumer attitudes to insurance.