Filling the Gap: Raising Life Insurance Literacy in the U.S.
A recent SIR webinar featured Hiroe Noonan, Manager, Market Research and Analytics at SCOR discussing the impact of the pandemic on life insurance sales and Allison Broglie Head of North America at ReMark, discussing what consumers know – or think they know -- about life insurance. Noonan noted the unprecedented 20% increase in life insurance sales during the first year of the pandemic could be attributed to the frequent, negative news about daily COVID-19 deaths and infection rates. Bombarded with the messages and perhaps personal experiences of being close to death due to personal health issues or having a family member or friend die during the pandemic brought the need for life insurance to the forefront.
After Noonan concluded her overview of the life insurance market post-COVID, Broglie demonstrated a dashboard developed by ReMark in conjunction with its 2021 annual Global Consumer Study (GCS) to illustrate consumer attitudes about life insurance, examining differences among generational groups. Filters on the dashboard also allow exploration of differences by gender, developed vs. emerging markets and by single or multiple countries.
While sales did increase in 2021 to nearly six million policies, it’s interesting to note that the number of people covered by life insurance did not increase as much as total premium rose. The pandemic actually did little to narrow the coverage gap in the U.S. Research from the International Insurance Society cited by Noonan listed four primary reasons why most Americans do not have coverage:
1. Think it’s too expensive
2. Process is too slow
3. Don’t think they need it
4. Confused how to apply
Improving consumer literacy could overcome the first, third and fourth objections to purchasing life insurance and potentially extend the upward life insurance sales trend, Noonan said.
Given the increase in the sales of life insurance, Broglie said questions about life insurance literacy were added to the 2021 GCS to measure whether consumers are meeting their needs with the life insurance products they need. She used the dashboard to examine differences between consumer confidence in their life insurance literacy and their actual knowledge as measured by their responses to questions in the GCS survey as well as the users’ desire to improve their life insurance literacy.
VIEW THE RECORDING