Are we scared to sell life insurance?
If you’re wondering where you might find your next life insurance client, cast your eyes out to the wilderness known as The Internet.
Out there, wandering and scared, are legions of people who set out to find life insurance and instead became disoriented by the online choices or stuck in cobwebs of information. Either way, they decided not to buy life insurance. That’s according to a LIMRA study called “Shopping for Life Insurance: The Uneasy Path to a Decision.” It was also an indirect path to that bit of information. It turns out that 21 percent of “serious shoppers” who bought life insurance went online for information. But 43 percent of people who seriously shopped for life insurance were looking online.
“Consumers seemed to be getting confused, making them less likely to buy,” said Ron Neyer, LIMRA’s assistant research director, distribution research. “In fact, buyers were less likely than all shoppers to have gone online.”
And this study was done last year – 2013, not 2003. Where else in life, these days, are people not going online for shopping information? It’s gotten so that if I’m choosing between sweet potatoes and yams in the produce section, I’m whipping out the phone and looking up the comparative nutritional value right there. (The sweet potato kicks yam butt in nutrients, by the way.)
So, why the exit ramp off the Information Superhighway? Largely because it’s still an opaque business where it’s difficult to find clarity, much less make comparisons. What’s the answer to a 45-year-old asking about a permanent life policy for $1 million or more? It depends. Term for under $250,000 of coverage? You can find that online. But a permanent policy for more than $1 million? Well, you have to go talk to this person, who has to chat with you for a while about you and the many options available and he might give you a price that’s contingent on a medical exam that might happen in a couple of days and depending on the company it might be a few days or weeks before we know for sure, and … by then a video of a hamster playing a piano on the side of the screen looks a whole lot more interesting.
In a sense, this is all good for insurance agents. They are still in demand. People still want to talk to somebody before buying, according to survey after survey. But how are they finding agents and advisors? Going online doesn’t seem too inviting.
Type “I want to buy life insurance” into The Google and the first thing you get back that’s not an ad is a news story with the headline, “4 Life Insurance Policies You Should Never Buy.” Then there’s “Why Buy Life Insurance” from Nationwide and so on in the same vein. Hey, I went looking for life insurance, not to feel unsure that I need it.
Type in “I want to buy a mutual fund” and the first non-ad item is an article from the Wall Street Journal headlined “How to Buy a Mutual Fund.” Next is “Basics of Investing in Mutual Funds” from CNN. So, right away I’m feeling validation. If it said, Why Buy a Mutual Fund?, then I might ask myself, well, why would I want to buy a mutual fund? Then I’d go find that hamster playing the piano again.
And have mercy on your soul if you type in “I want to buy an annuity.” You may as well ask, “Should I tattoo my social security number and date of birth on my forehead?”
One thing the insurance industry suffers from is the absence of business-to-consumer media. Most publications speak in financial terms and we know how our pinstriped brethren feel about life insurance and annuities. But we also have some lousy self-esteem. If someone goes out there and yells, “Hey, who wants to sell me some life insurance here?,” the answer shouldn’t be “Are you absolutely sure you want to buy life insurance?”
So, when we say that people aren’t buying life insurance, maybe it’s because we aren’t selling it.