Many potential consumers put off purchasing life insurance due to concerns about the cost of the insurance or concerns about the products being too complicated or the response time for approval being too long. However, many of the issues Americans might have worried about years ago no longer apply, but enrollment still isn't rising as quickly as some in the industry would like. For this reason, it might be wise for insurers to do more outreach going forward.
While many Americans continue to acknowledge that life insurance is vital to their safety, the fact of the matter is that many people - especially those in their 20s and 30s - just don't have it, according to a report from the financial news site Main St. Several polls have shown significant misconceptions about such coverage, though, as many Americans think that the policies are too expensive for them to afford, or can be complicated to buy.
Consequently, it seems that a little bit more may need to be done on the part of life insurers to clear up these beliefs among consumers, because that might be able to significantly boost the number of new policies being taken out going forward, the report said. One of the biggest issues that people have cited as a barrier over the years is that they don't want to have to go through a medical exam before obtaining life coverage, and now many companies have dispensed with that requirement, especially when it comes to policies with smaller benefits overall.
Other steps being taken these days
Meanwhile, many companies are trying to do more to ensure that the underwriting process is completed as quickly as possible. Underwriting times for some companies have been shortened to just a day or two, rather than the few weeks it might have taken as recently as a decade ago. Further, with competition for a relatively small pool of interested applicants remaining quite high, and technology playing a larger role in the process, consumers might also benefit from declining prices they otherwise might not have known about.
Life insurers will have to keep close tabs on what their competitors are doing in terms of better connecting with consumers. The more insurance companies can do to educate consumers on the need for coverage and relieve some of the concerns they may have with regard to purchasing insurance, the better chance for sales growth.