Planning for death sounds really absurd, especially when there are those big dreams that are yet to be actualized. The hard truth is that death is an unavoidable reality and it is critical that plans are made for it. This is where a good life insurance policy comes to play.
A recent study shows that 59% of respondents have placed priority on financial matters other than life insurance plans and 64% think that life insurance policies are too expensive.
Interestingly, there has been a paradigm shift from the traditional life insurance policies to more flexible, tech-oriented and time effective systems. For instance, insurtech startups like Bestow now make it possible to purchase a good life insurance plan online, without a medical examination.
“Millions of Americans value life insurance but lack coverage because traditional offline options don’t align with today’s digital consumer,” according to Bestow Co-Founder and President, Jonathan Abelmann.
“We knew there had to be a better way. We reimagined the entire experience with a fully digital solution that delivers coverage in a few minutes, removes pain points like medical exams, and is super easy to manage. It's empowering families to get the affordable protection they deserve."
With 2018 around the corner, it is expedient to look at some key trends in the life insurance industry as it will concern both insurers and customers. Here are a few:
1. The internet advantage.
Some two decades back, life insurance was bought on a face to face basis. You see insurance salesmen come to your doorstep to sell life insurance to you. Every step taken required a physical meeting between the consumer and the insurance agent. This could be very cumbersome and time consuming.
Today, you can buy a life insurance plan from the comfort of your home or office through the internet.
The internet also has made financial education, especially as it has to do with life insurance more understandable. And this is good for millennials as 92% of millennials are lacking coverage due to poor financial education. However, the internet has bridged the financial literacy gap among millennials.
Baby boomers, who bought life insurance through the traditional means, are not left out in this.
2. The Use of Cloud Computing.
One of the reasons most Americans were tuning off from getting a life insurance plan is apparently the huddle and stress in getting all the details required by an insurer across.
A lot of millennials say that the underwriting processes are tedious and time consuming. Hence, we have a large percentage of millennials who do not have a life insurance coverage as a result of this hitch.
Whatever be the case, insurers must have adequate details of the health status, medical history, hobbies, occupation, smoking habits, and family history of clients in order to determine whether or not they are eligible for coverage. This also helps to determine the premium that its due.
Here comes cloud computing. Most of the information needed by an insurer can be accessed using cloud computing. Though there are still trust issues as to the safety of information stored in the cloud, the cloud is one smart and time effective way of getting information.
Another challenge to fully integrating cloud technology into life insurance policies is the over dependence of insurance companies on legacy technologies. Be that as it may, a few companies are adopting cloud technology as a replacement for the out of date legacy technologies.
3. Automated Underwritings.
Apart from cloud computing, automation is another smart way of going about underwritings.
The global insurance market is getting more competitive and this is to the advantage of the consumer. Automation tools enable insurers keep up the pace with customers’ changing needs and preferences.
Social media has made it possible for people to have accessible digital lives. Hence, insurers can effectively interact with customers and automatically track changes in their underwriting details.
Automation enables insurers shift their focus from merely calculating risks for premium evaluation to using real time analytics to help customers mitigate risks. The vast majority of people will prefer to have a life insurance plan with a company that will help them mitigate risks.
4. Multi-Channel Access.
It will be stating the obvious to say that we are in a tech controlled dispensation were customer needs are digitally inclined. This has in turn affected the way customers expect to access products and services. Life insurance services are no exception.
Customers are craving for smart and seamless ways of accessing life insurance services. The ambiguity of the traditional methods makes customers weary.
In a mobile frenzy generation, a mobile application that helps customers have access to their life insurance plan is very important.
This will not only make it easier for customers to follow through with their plans, it will also afford them the opportunity to regularly update their details from anywhere, on any device. As a consequence, the underwriting process is made as seamless as possible.
5. Integration of Blockchain.
Blockchain being a decentralized technology is gaining traction in the life insurance industry. It provides for a more transparent process for both the insurance agents and customers.
Critical to its advantages is the removal of fraudulent claims and activities with its end to end auditability. With Blockchain, claims can be processed faster and smarter, especially when a customer is in distress. Blockchain is changing the life insurance business into a smarter and flexible one.