Buyer apathy towards annuities and life insurance coverage is a perennial problem for suppliers. Satisfaction is rising as extra shoppers have interaction with digital instruments and begin utilizing life insurance coverage and annuities for monetary planning, along with such last planning companies as dying advantages and burial insurance coverage, in line with a examine launched Thursday by J.D. Energy.
“Gross sales of life insurance coverage loved a short surge in recognition throughout the top of the pandemic, whereas gross sales of annuities have extra just lately soared,” Breanne Armstrong, director of insurance coverage intelligence at J.D. Energy, mentioned in an announcement. “However outdoors of that, buyer satisfaction and engagement have usually declined the longer prospects maintain onto these merchandise.”
That’s beginning to change, Armstrong mentioned.
“Prospects who work together with the digital choices of their suppliers are extra engaged, have greater ranges of satisfaction and usually tend to incorporate their life insurance coverage and annuity merchandise into their general monetary plans,” she mentioned.
The examine is predicated on two surveys that J.D. Energy performed from Could by means of July. One measured the satisfaction of three,579 prospects of the most important U.S. annuity firms on their efficiency in the identical 5 key elements.
The opposite regarded on the satisfaction of 5,588 shoppers of the most important U.S. particular person life insurance coverage firms, primarily based on their efficiency in communication, interplay, worth, product choices and statements.
Satisfaction Surges With Digital
The analysis confirmed that buyer satisfaction with annuity merchandise averages 800 (on a 1-1,000 scale) this yr, an 11-point enhance from 2022. This, too, is pushed largely by elevated digital engagement.
Total satisfaction ranges are highest when annuities are bought by way of supplier web sites, J.D. Energy says, and so are buyer satisfaction with the applying and orientation course of.
J.D. Energy additionally discovered that 72% of annuity prospects can now be referred to as digital shoppers who commonly work together with their supplier by way of web site, e mail, chat, textual content or cell app. Total satisfaction amongst digital prospects is 819, in contrast with 784 for many who don’t have any digital interplay and 726 for many who don’t have any interplay in any respect with their supplier.
The variety of prospects who purchase life insurance coverage insurance policies by way of insurer web sites accounts for 13% of all life insurance coverage purchases, up from simply 6% in 2019. All informed, 62% of life insurance coverage prospects now work together with their insurer by way of digital channels.
Total satisfaction is 823 (on a 1,000-point scale) when prospects use digital channels; that’s 79 factors greater than when prospects don’t work together by way of digital.
The proportion of life insurance coverage prospects who purchase their insurance policies for each monetary and last planning causes has elevated to 39% in 2023 from 30% in 2022.
Total buyer satisfaction with life insurance coverage insurance policies is considerably greater when they’re bought for each causes, versus solely last planning or monetary planning alone.
Even for merchandise bought by means of brokers or advisors, including in digital interplay solely will increase buyer satisfaction, the examine discovered. When life insurance coverage prospects who purchased by means of an agent or advisor work together solely non-digitally, satisfaction is 795. It will increase to 821 when digital interactions are added.
This pattern additionally exists amongst annuity prospects who bought their annuity by means of an agent or advisor, with satisfaction at 809, versus 784 for many who didn’t have such a interplay.
See the accompanying charts for the annuity and life insurance coverage suppliers with the very best and the bottom buyer satisfaction.