Life Insurance Customer Journey

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Life Insurance Customer Journey

The three most influential life events that triggers a consumer to purchase a life insurance policy include getting children (62%), a recent purchase of a house or change in financial situation (54%), and getting married (53%). Consumers aged 45 years and older are majority policyholders of life insurance policyholders. Over 50% of American consumers prefer researching online before purchasing a policy while 51% of consumers prefer discussing face-to-face with an insurance agent in order to get expert advice before making the decision to purchase a life insurance policy.

TRIGGERS & LIFE STAGES

According to a 2018 survey report by Deloitte, 62% of the respondents indicated that having children was the most compelling factor that impacted on their decision to purchase a life insurance policy. This is compared to 54% of consumers who make the decision after experiencing a significant change in their financial situation, 54% after they have purchased a home, and 53% after getting married.

Other lesser common life events that impact on consumers decisions to prioritize a life insurance policy include considering retirement at 52%, death of a close person at 48%, loss of insurance coverage through a group policy at 47%, and a recent "large-scale disaster" at 41%. The less common factors that impact on the decision of consumers to purchase a life insurance policy include divorce or doctors appointment at 38% on either of the events. Additionally, most consumers of life insurance in the US are usually aged 45 years and older while consumers from the younger generations are less likely to go for a life insurance cover because they do not consider it as a necessity as compared to other current financial obligations.

CUSTOMER JOURNEY

BEHAVIOR & BARRIERS

Millennials are twice as likely to purchase life insurance policies as a result of recommendations from close family members and friends. When it comes to purchasing life insurance policies online, about two-thirds of consumers feel more confident and are more likely to purchase a policy from an insurance agency that has a strong social media presence, as well as, an up-to-date website. However, about 51% of consumers of life insurance policies in the US prefer discussing the details of the policies and making the purchase later after having face-to-face interactions with insurance agents.

Among the barriers that deter consumers from purchasing life insurance policies include the pricing of the policy whereby 64% of US consumers choose to forgo the policy because it is expensive while 59% do not perceive life insurance as a top financial priority in their budgets. Additionally, approximately 38% of Millennials, 19% of Gen Xers, and about 16% of Boomers do not believe that they qualify for a life insurance policy. According to NoExam, at least 50% of US consumers would be willing and likely to purchase a life insurance policy if the policy did not mandate taking a medical exam prior to making the purchase.

PRIMARY METHOD & CHANNELS UTILIZED

At least 50% of US consumers rely on the information published online to get insights into the best insurance agency before they make the decision to purchase a cover online. In 2018, approximately 19% of Millennials and 26% of Gen Xers reported that they preferred to first conduct a research online and later purchase the policy online. Between 2016 and 2018, the number of US consumers who preferred researching life insurance policies online and then making the purchases online increased by 7%.

However, at least 55% of Millennials, 43% of Gen Xers, and 38% of Boomers, still prefer visiting brick-and-mortar offices where they engage insurance agents or financial advisors to purchase a policy after they have conducted their online research. Most consumers in the US visit insurance agents and financial advisors before purchasing life insurance policies because they consider the expert opinion a major impacting factor of their buying decision. Among Millennials who research online for the most reliable life insurance policies, most of them usually prefer visiting physical offices for research and consultation compared to at least 49% of the population that prefer gathering the information from at least one comparison website when conducting research.
Sources
Sources

Quotes
  • "Consumers generally have a limited awareness of life insurance and do not understand the need for a policy until a life event triggers action."
  • "It takes an important life event to prompt respondents to consider purchasing life insurance - not marketing outreach."
Quotes
  • "Despite nearly 90% of consumers saying that most people need life insurance in some form, less than two-thirds of Americans actually have a policy in place."
Quotes
  • "In what seems to be a growing sentiment from last year’s data, consumers are increasingly focused on two main aspects when they sit down to buy their life insurance policies: speed and convenience."
  • "50% of people will admit they have a higher propensity to buy life insurance if they can do it without the medical exam."
  • "Among the Millennial generation, a majority prefer to do their own research on what they need over the internet, but admit they would still end up buying from an agent face-to-face."
  • "Almost 3 in 4 people think the greatest benefit an insurance company can offer are simplified issue policies."