Future of Life Insurance: Customer Service Takes Priority
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Ever since the COVID-19 pandemic, the world has seen a great number of changes. The pandemic has affected many industries, and the life insurance industry is no exception. How has the life insurance industry been impacted and what does the life insurance industry look like in the future? The global management consultant, McKinsey & Company provides the data and insight into what the future of life insurance may look like. They detailed how the main key to the future of life insurance relies heavily on improving the customer experience.
Personalize Customer Experience
The need for life insurance is at a high in recent years, especially due to the COVID-19 pandemic. Healthcare costs are rising while pension plans in the job sector are declining. Similarly, the number of American citizens that do not have mortality protection in the form of life insurance has been increasing. In order for life insurance companies to become profitable, they need to ensure that they personalize each step of their customer service experience.
Current Customer Satisfaction
Final Expense Benefits always sites JD Power when it comes to calculating customer satisfaction. For life insurance and annuity customer satisfaction, there has been a steep decline. JD Power notes a customer engagement issue. This is especially true when satisfaction with these kinds of products and services begins to decline shortly after purchase. Now, plenty of insurance companies excel in customer satisfaction like Mutual of Omaha. Many companies are researching and looking into how they can be the best provider they can be to their customers.
Another customer service issue that has been identified is within the underwriting process itself. Oftentimes, agents look to push their products over providing educational support and objective advice. It is not the agent’s fault as the life insurance system is set up to be that way. Insurance companies often work tirelessly to make the sale and then abandon their insured afterward. There are a number of ways to combat this, however.
Using Technology to Reshape Customer Service
By the year 2030, older people are projected to outnumber young people for the first time in US History. More than 50% of the US population will be over the age of 60. These factors along with the increased number of pre existing conditions and health concerns will motivate life insurance companies to further engage with their customers. You may be wondering, how could technology help with this.
Promoting health-related wearable technology is one step for companies to take a more proactive approach with their customers. Many people already wear this type of tech and the data collected can allow companies to create a personalized plans for consumers. Nowadays, people are willing to share this data in order to get plans and products that best suit their needs. People will happily share their health information or health progress if it means getting a discount on a policy.
Predict, Personalize, Engage, and Share
To do right by their customers, life insurance companies are urged to move away from their old “assess and service” model. This model is the standard for almost all insurance companies where underwriters assess the risk people and provide care suggestions. Policies are then priced out depending on their findings and are serviced. In the next decade, however, insurance companies should seek to improve this by moving to a more customer-centric model of doing business. Information collected from technology should be used to assess risk and provide specialized and individualized wellness plans for customers. When it comes to the future of life insurance, agents should strive to build customer service relationships and humanize any advice brought up by health technology.
Agents should also use technology like AI to quickly find the best possible deals for their customers that are specific to their needs. Integrated platforms allow for the lines of different health, wealth, and life products to blur within a market that specifically caters to customer needs. The data used as well will become more holistic as we view risk categories differently. Health companies should strive to provide personalized products that continuously engage customers to improve their health and give them incentives to positively influence health outcomes.
Life insurance companies can greatly benefit from looking at how other financial product companies offer and sell their products. For example, retirement plans and living benefits can be one of the many ways in which companies can improve customer experience. Being transparent about products and performance will increase trust from consumers. This will allow customers to make more informed decisions about the financial risks of retirement and can be used as a way to gauge the goals of customers. This will allow asset managers to score any risks involved and then build potential customers up rather than having them settle for a mediocre plan.
Skills for the Future of Life Insurance
It is estimated that roughly 44% of financial services have the potential to be automated by the year 2030. While this may seem scary it is important to remember that automating repetitive tasks makes interpersonal and social skills will be even more important. This presents life insurance and financial product companies with a golden opportunity to reframe their products. Improving the tech and interpersonal skills of employees will be paramount for the success of life insurance.
Life Insurance for Millenials and Younger
Millennials are young people who are now between the ages of 24-40 and possibly older. They are the age at which most people will begin to have a need for life insurance. Many Millenials within that age group now have families, children, and debts. But most millennials have no life insurance coverage and have misconceptions about what life insurance is for. This leaves many young families completely vulnerable and without any protection at all. Many think that they will not qualify for life insurance coverage or if they did it would be entirely too expensive. The future of life insurance companies is in the hands of millennials and the younger generations. More effort needs to be put into representing them and their needs. This ties into life insurance companies needing to reach out and educate younger generations on why mortality protection is so important and what that can mean for their future financial security.
Do I Need Life Insurance?
If you have dependents or assets that need to be protected then chances are you absolutely have a need for life insurance. Achieving retirement in this day and age requires proper planning and having clear and attainable financial goals. Here is a small list to help you decide if life insurance is right for you.
- Your partner lives off your income or you are the main breadwinner.
- You have young children or other dependents.
- You have a mortgage, college expenses, or other kinds of debts.
- If your family would struggle financially in paying for your funeral expenses.
- You own a business that could fail should you pass away suddenly.
There are a number of scenarios that showcase different people and situations where having life insurance can be really beneficial. Talking to an insurance agent can really help you figure out if this move is right for you.
The Future of Life Insurance: Best Options for Me
We explored the changes life insurance companies need to make to improve their relationships with their clients. How can you, as the consumer, find the best option for life insurance right now? We are alive right now and cannot afford to wait until 2030 for the future of life insurance to come to us. Where do we start searching from here? Luckily, there are a number of life insurance companies that are breaking the mold now. They have already begun to embrace what customers need from them. Final Expense Benefits partners with over 20 carriers with customer satisfaction guaranteed. They offer no medical exam options at much more affordable rates that fit your needs. Some of our highly-rated carriers include:
If you are looking for trusted and affordable final expense insurance, the experts at Final Expense Benefits have got you covered. Call one of our talented agents today at 1 (866) 311-4338 to get an affordable quote with one of our highly-rated insurance carriers.
Frequently Asked Questions
Term insurance plans cover you for a set duration of time. Typically these policies span from 10 – 20 years. These policies are often the most affordable and have lower monthly premiums. You can renew policies if the term is up but you still need life insurance.
Unlike term, whole life insurance is a type of policy that lasts for as long as you pay the premiums. Usually, the policy has a clause to end if you live over 100 years old. Whole life insurance also has a cash value that grows over the lifetime of the policy.
Joint life insurance, or dual life insurance, are permanent life insurance policies that insure two people instead of one. Some policies are term life insurance policies but these are much rarer.
Universal life insurance is a type of permanent life insurance where a portion of your premium covers the insurance cost and the other portion accumulates interest. It allows you flexible payment options and to adjust your face amount.