September is Life Insurance Awareness Month. It’s well known that four out of 10 American households are putting their financial future at risk by not having life insurance. I wanted to dig into the little known aspects of pre-sales, sales, fulfillment, and inforce digital platforms that make a difference in generating new business, motivating consumers, placing business, and policy retention.
Pre-Sales and Sales Technology Solutions that Engage Consumers to Buy
Digital point-of-sale tools are surging in the marketplace that are both consumer and advisor facing. What’s new are the innovative sales models leveraging insurtech created to target the 72 million millennials (ages 25-40), and also to simplify the process for everyone applying for life insurance. I reached out to Patrick Bowen who is one of the co-founders of InsurAware. Patrick has a long and impressive career in sales leadership with Genworth, Midland National, and Legal & General America. “As the wealth gap in the United States continues to grow, the coverage gap is putting millions of families and communities at grave financial risk in the event of the loss of a breadwinner. Our industry must improve on attracting new customers, and through our proprietary lead-generation and lead-nurturing algorithms, InsurAware is bringing awareness and accessibility to life insurance for previously underserved populations,” explained Patrick. What you don’t see with many point-of-sale life solutions is the participation in the complete value chain that includes lead generation, lead marketing, and lead fulfillment. InsurAware has a digital, cloud-based platform that is agile with a versatile chassis. It can generate leads organically or from an existing database.
We are now several years down the road into the Fintech transformation era. There is no doubt that insurtech platforms are now inspiring more financial advisors and consumers to consider and adopt life insurance. New online digital distributors—such as HavenLife™, Ladder™, and Ethos Life™—deliver experiences that help more and more middle-market consumers quickly and easily purchase term life insurance. So much so that Ethos Life’s tagline is “Life insurance made easy.”
The same growth opportunity exists for the BGA community if they direct their focus toward adopting and delivering new digital experiences where it matters most—at the point of sale (PoS). Why? Let’s look at a few key market opportunity growth trends now in play which underpin this emerging landscape, if U.S. life and annuity distribution shift with the times:
- A complete shift by financial advisors to digital planning and product experiences.
- Millennials are now aging up to 42 and entering prime retirement planning years.
- New agents (Millennials, GenZ) looking to learn and sell product on digital platforms.
Today, the life insurance sector is rapidly making the shift to close the digital experience gap in this regard. There is a new drive to more clearly articulate the permanent life insurance value proposition through visual story-telling—with the objective to help transform the agent-consumer discussion. Ensight’s new “Sales Story” platform continues to drive a significant leap forward in helping to meet this emerging industry dynamic. The configurable sales story engine enables carriers and distributors to rapidly create a broad range of different types of digital, interactive sales experiences—based on rich content and personalized client illustration data. For instance, a “Sales Story” may take the form of a new engaging product or sales concept to support a critical market launch, encapsulating the product benefits and performance in an intuitive, personalized interactive microsite. Or a “story” may take the form of an online product training course. Or a step-by-step “sales playbook” for the agent to walk a client through a proposal at the point of sale. Modernizing point-of-sale agent support and client digital experiences is critical to sustainable growth for the life and annuity sector going forward.
Illustration systems play a critical role in the sales process and the ultimate buying decision for life insurance and annuity products. These systems are crucial in providing detailed, informative, and compliant illustrations. They are quickly evolving into a valuable and powerful tool to drive sales and instill consumer confidence.
The evolution of illustration systems is to not just be a tool that generates numbers and disclaimers, but is a significant piece engaging with the consumer in the sales process. “Technology has transformed illustration systems exponentially by increasing their value in driving new sales while delivering significant operational efficiencies,” says Lyndon Edwards, president of illustrate inc, a leading provider of quoting and illustration solutions for the life and annuity industry. “These robust and feature-rich Insurtech solutions are designed to provide instant information and simplify the buying process in an engaging and collaborative environment. These new-age solutions simplify the process by providing a quick and easy-to-understand system for even the most complex products and client situations, leading to a higher rate of success.” Edwards adds, “Layering in customer and user experience, sales tools, and innovative technology, with the ability to generate instant, detailed, and compliant illustration reports provides tremendous value to the buying process and is a highly effective tool in driving new business.”
Life Insurance Fulfillment Process Can Save Lives
I think today we overlook the value to the consumer of paramedical exams for life insurance. Medical exams for life insurance often provide insight into medical conditions previously undiscovered. I spoke to Joe Klein, senior vice president of National Accounts at American Para Professional Systems (APPS). Joe explained that by completing the medical exam and blood draw with APPS, consumers can become much more informed about their health via simple, secure, no cost access to their lab results. Once their laboratory results are available, the applicant receives a text message to log in via Clinical Reference Laboratory’s online portal called Access My Labs 2.0. A brief video is provided to the applicant so they will understand the process and power of the information they will receive from their blood and urine test results.
According to the CDC… (https://www.cdc.gov/diabetes/basics/quick-facts.html):
- One in five diabetics don’t know they have it.
- More than 88 million U.S. adults, over a third, have pre-diabetes, and more than 84 percent of them don’t know they have it.
- Diabetes is the seventh leading cause of death in the United States (and may be underreported).
Policy Preservation—Engaging Consumers with Mobile Apps
The fact is consumers miss life insurance premium payments for various reasons. When this happens a carrier typically sends a “Late Payment Notice” to the customer. Unfortunately that piece of snail mail is quite often overlooked or ignored by the customer. This practice has resulted in only 16 percent of customers making the timely payment, and up to 84 percent of those policies lapsing. The result is families lose critical financial protection and carriers have the business fall off their books. The good news: When a customer has a digital connection with the carrier, typically a carrier app, the results can be greatly improved. When a customer misses a premium payment, that customer still has to be sent the snail mail warning of potential lapse, but also can be sent a push notification, text or email notifying the customer of the missed payment with an offer to accept the payment immediately through an ACH or credit card payment. Sureify has a mobile app “Lifetime Service” which enables digital self-servicing for your customers. It empowers customers to securely manage everything from payments to beneficiary updates. Sureify’s customers have reported going from 16 percent preservation to as much as 64 percent—a 300 percent increase in business staying on the books. A win for the customer, the carrier, the agent and the reinsurer.
Another valuable service is an annual policy review. A good example is a reminder for the customer to review the beneficiaries, not only of their individual life insurance policies, but their group insurance policies, 401(k)s, pension and IRAs. Recently, one of Sureify’s customers sent push, text and email notices to their customers suggesting they review and update their beneficiary. The result was five percent of their customers updated, with ease, their beneficiaries. The carrier received many thank you notes from policy owners who discovered that their ex-spouse or ex-partner was still listed as the beneficiary. A simple call to action, typically not one an agent would do, that resulted in great appreciation from the customer. It’s well documented that significant increase in NPS (net promoter score), increases in persistency, and a five times greater likelihood to buy additional insurance from the carrier is a direct result of the carriers providing an Uber/Amazon/Netflix modern technological experience.
We are going through an insurtech evolution right now for life insurance. This goes beyond mature functionality and integrated solutions in life insurance sales tools. These new innovative solutions and processes are engaging and intelligent. The end result is that we are educating the consumer, simplifying the process, and enabling self-service. Speed and convenience are important components, but if we want to succeed in getting more households insured, then awareness needs to be woven through the entire value chain from pre-sales to sales, applying, fulfillment and post-issue.