Even after the recession, many in the life insurance sector were concerned about the trends that left many Americans without coverage and little in the way of prospects for buying it any time soon. Fortunately, the economic recovery brought with it a renewed enthusiasm about life coverage and a growing need among younger adults for these policies. As such, many now see the life insurance sector as being at one of its strongest positions in recent memory.
By any number of measures, the life insurance industry is now doing better than it was prior to the economic downturn, according to the latest data from the Kroll Bond Rating Agency. This includes the fact that capital and surplus are now at the highest levels ever observed, and earnings are on the rise despite years of low interest rates. To that end, Kroll now believes the industry is both in a stronger position overall at this time and more prepared for unexpected adverse economic conditions in the future.
The changing future
Indeed, it's worth noting that there could be many issues that arise for the life insurance industry in the year to come and beyond, the report said. For instance, issues such as self-driving cars, cybersecurity, and further development of artificial intelligence could all weigh on how life insurers assess risk both for themselves and their policyholders. The good news is that in the meantime, it's likely that more people - and younger adults, in particular - will keep coming to buy coverage.
"Disruption will continue to be a major theme in 2017," Kroll wrote in explaining its findings. "Although it has been quite favorable for financial markets the last few months, the election of Donald Trump adds an additional layer of uncertainty to the sector. Typically, uncertainty and volatility go hand in hand, and the economy may be approaching an inflection point. At this time, KBRA believes companies are well positioned and can withstand another 'perfect storm.'"
Of course, while many Americans see the benefits of life insurance, they may not always fully understand the ins and outs of coverage, and experts say such knowledge is vital to finding the policies that work best for their unique situations, according to Tech Featured. With this in mind, it might be vital for consumers to carefully go over their options with the help of an insurer to find the coverage that makes the most sense, and to talk about any potential misconceptions people may have about the options available to them.
Studies show that people tend to dramatically overestimate the cost of life insurance and often don't know about all the various affordable options the industry provides. This is why education efforts on the part of insurers are so important not only to improving their own bottom lines, but also helping people find plans that will meet their specific needs, potentially for decades.