Buyer apathy towards annuities and life insurance coverage is a perennial problem for suppliers. Satisfaction is rising as extra purchasers interact with digital instruments and begin utilizing life insurance coverage and annuities for monetary planning, along with such ultimate planning providers as dying advantages and burial insurance coverage, in line with a research launched Thursday by J.D. Energy.
“Gross sales of life insurance coverage loved a short surge in reputation in the course of the peak 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 a press release. “However outdoors of that, buyer satisfaction and engagement have usually declined the longer clients maintain onto these merchandise.”
That’s beginning to change, Armstrong mentioned.
“Clients 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 total monetary plans,” she mentioned.
The research relies on two surveys that J.D. Energy carried out from Might by way of July. One measured the satisfaction of three,579 clients of the most important U.S. annuity corporations on their efficiency in the identical 5 key elements.
The opposite appeared on the satisfaction of 5,588 purchasers of the most important U.S. particular person life insurance coverage corporations, based mostly on their efficiency in communication, interplay, value, 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.
General 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 appliance and orientation course of.
J.D. Energy additionally discovered that 72% of annuity clients can now be known as digital purchasers who frequently work together with their supplier by way of web site, e-mail, chat, textual content or cellular app. General satisfaction amongst digital clients 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 clients 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 clients now work together with their insurer by way of digital channels.
General satisfaction is 823 (on a 1,000-point scale) when clients use digital channels; that’s 79 factors greater than when clients don’t work together by way of digital.
The proportion of life insurance coverage clients who purchase their insurance policies for each monetary and ultimate planning causes has elevated to 39% in 2023 from 30% in 2022.
General buyer satisfaction with life insurance coverage insurance policies is considerably greater when they’re bought for each causes, versus solely ultimate planning or monetary planning alone.
Even for merchandise bought by way of brokers or advisors, including in digital interplay solely will increase buyer satisfaction, the research discovered. When life insurance coverage clients who purchased by way 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 clients who bought their annuity by way of an agent or advisor, with satisfaction at 809, versus 784 for many who didn’t have this sort of interplay.
See the accompanying charts for the annuity and life insurance coverage suppliers with the very best and the bottom buyer satisfaction.