By Juliette Fairley  Financial Planner

Uninsured individuals do not have insurance coverage because no one had offered to sell them a policy, according to a new survey that explored life insurance buyers and non-buyers’ beliefs, motivations, influences, priorities and preferences.

Deloitte’s “The Voice of the Life Insurance Consumer” study found that 62 percent of non-buyers had not received an unsolicited offer to buy life insurance in the past year compared to 44 percent of buyers. Another 30 percent said their employer does not offer life insurance as a benefit while 46 percent of buyers compared to 66 percent of those currently uninsured said they had not looked for life insurance on their own initiative.

“Many life insurers are not dealing directly with prospects,” Deloitte Research Insurance Leader Sam Friedman told Insurance Networking News. “Instead, insurers distribute their products through agents and financial planners. Part of the challenge facing carriers is how to work more proactively with their agency force to provide the tools, marketing and advertising support to better educate consumers about everything life insurance can do for them and their families and create more demand for their products and services.”

Older respondents who were current buyers found unsolicited offers to be less influential. About 70 percent of current buyers 50 years old and older—compared to 12 percent of those 26 years old and under—said such offers were not at all influential compared. The same age-related trend was evident with the uninsured sample as well.

“Among a variety of other steps, insurers are getting more involved in social media to highlight to a younger generation especially the importance of financial protection,” American Council of Life Insurers Spokesperson Jack Dolan told Insurance Networking News.

The Deloitte study found that the Internet was a vital information source for both buyers and non-buyers. About 32 percent of current buyers and 27 percent of non-buyers did a general Web search about life insurance, while another 21 percent of buyers and 16 percent of non-buyers had surfed specific insurer websites. In addition, 8 percent of buyers and 10 percent of non-buyers had surfed insurance agency websites.

“The Web and social media in particular can play a huge role in helping insurers distribute information to demystify life policies, educate prospects about all the financial needs life insurance can fulfill beyond simple death benefits and create awareness about the product’s affordability,” said Rebecca Amoroso, vice chairman and U.S. insurance leader for Deloitte and the survey’s executive sponsor.

About 26 percent of respondents found the application and underwriting process too difficult, according to Deloitte.

“The process could be discouraging many prospects from going through the application process because invasive medical tests may be required, such as blood and urine tests,” Deloitte’s Friedman said. “In many instances, insurers can make the process easier and faster by using predictive analytics, eliminating the need for invasive tests for many prospects and speeding up the sale without compromising the integrity of the underwriting process.”

While life insurance is not the top financial priority for most, Deloitte notes that consumers desire life insurance coverage.

About 45 percent of non-buyer respondents included life insurance among their top five financial priorities and 21 percent ranked it in their top three. Life insurance ranked even more prominently among those who already have life insurance with 70 percent putting life insurance among their top five priorities and 34 percent included it in their top three.

“Life insurers can proactively market a positive message either individually or perhaps as part of an industry-wide ad campaign showing how a policy can support a family or business in so many different ways in the short- and long-term,” Friedman said.

Among the non-buyers, 37 percent of those who had life insurance in the past said the workplace was a big source of sales with 43 percent automatically securing a policy through their employer and 20 percent buying additional benefits through their group plan. Only 16 percent had bought coverage on their own through an agent compared to 13 percent through a carrier. And 5 percent bought through a group or association.

“Life insurers could work more closely with employers to promote automatic and voluntary life benefit options since many of those surveyed prefer to buy coverage through their places of work,” Deloitte’s Amoroso said.

Investment News
by Darla Mercado

Agreement requires insurer to step up cross referencing to locate unpaid beneficiaries. Prudential Financial Inc. has settled with Massachusetts and 19 other states, agreeing to improve its practices in identifying beneficiaries who are due unclaimed life insurance death benefits. Continue reading…

California Broker
by Peter Katz

On December 4, 1911, the United States Supreme Court decided the case of Grigsby vs. Russell, which is considered to be the legal basis for the life settlement industry today. The decision, written by the legendary Justice Oliver Wendell Holmes, Jr., ruled that the sale of a life insurance policy, which was validly obtained by someone with insurable interest, could be legally sold to a third party without insurable interest. Continue reading…

National Underwriter
by Michael Stanley

On a recent Wednesday afternoon, I found myself sitting in a tidy, angular room in a restaurant at the Museum of Modern Art in midtown Manhattan. The steam from the subway and heat from the street had conspired to dishevel me and I was in stark contrast to the waitstaff, who, with their black suits and perfectly coiffed hair could best be described as a mix between Victorian butlers and runway models. As I tried my best to feign comprehension of some of the minimalist pieces that hung from the walls, I made small talk with some fellow journalists. We were attending an event described as a “life settlements 101″ course. It was held by Coventry, a leading company in the secondary insurance market, and was something I was interested in since my understanding of the secondary market is not as deep as I would like it to be. Continue reading…