Chief Executive Insights

4 Insurance Trends for 2022: Focus on Technology, Customer Education & Dynamics

As the world turns its focus on 2022, still emerging from the Covid pandemic after nearly two years, many industries continue to shift their business models and customer-related marketing strategies to remain profitable and stay in business.

The life insurance industry is no different. Companies are re-evaluating their focus and messaging to better connect with – and inform – targeted markets and address the related changes in buying behaviors.

Here are 4 predictions for the life insurance industry in 2022:

  1. A Focus on Changing Millennial Mindsets & Dispelling Myths
    More companies will be targeting Millennials in 2022 for life insurance. Generation Y now represent the largest U.S. demographic, about 72.2 million strong. Yet, when it comes to life insurance, they’re underserved.

    In the absence of true knowledge about life insurance – the options that exist, how they qualify and costs — Millennials hold onto preconceived notions and ideas that need to change.

    Many 25- to 40-year-olds don’t consider life insurance a “must-have.” It’s all about information, or lack thereof, as these telling statistics, courtesy of the Best Life Rate website, show:

    # 44% of Millennials overestimate life insurance costs by 5x.
    # 58% don’t buy any life insurance because they don’t know the policy type or coverage amount to get.
    # 38% don’t purchase coverage due to fear they won’t qualify.
    # 43% say they simply haven’t been approached about purchasing coverage.

    It’s past time to turn the insurance industry on its head and change perceptions. The best way to change this mindset is to focus on specific messaging that resonates with this demographic to better educate them – explaining that policies are available for all budgets and price points, even for those with pre-existing conditions. The right life insurance provider can help determine how much coverage a customer needs, taking budget into consideration.

    With greater education using social media, the insurance industry can dispel many of these life insurance myths. According to Best Life Rate, Millennials use social media more than other age groups for research, to verify insurer details, advisors or agents before doing business: Facebook (26%), Instagram (11%), Twitter (9%), Linkedin (9%) and YouTube (17%). Those who trust the agent/advisor and company are most likely to buy life insurance. So, sharing clear details about costs and options can help.

  2. More Self-Employed People Will Buy Policies
    Another Covid-related impact for the insurance industry which will continue into 2022, is that there are greater numbers of potential policy buyers who are self-employed.

    In addition to layoffs, there were many resignations during the pandemic for childcare and other reasons. Many of these people started their own businesses; more than 4 million applications were filed for new businesses in 2021 through September.

    Millions of people likely started new companies because they wanted to leave their mark; to make a difference. They are in search of better opportunities for themselves and their families, and if that is the case, life insurance is a smart part of that strategy.

    With the right life insurance policy, people can ensure that their family will see the benefits from their hard work after they’re gone.

    Often, people let their employment status determine life insurance coverage. This is another myth that the insurance industry will change in 2022 through education.

    When they leave their jobs, many people don’t realize that they still can get life insurance on their own. Those who are unemployed, self-employed, a gig worker, or a freelancer, can still get affordable life insurance coverage.

    People that are running a business need their policy transactions to be simple, digital-first and with a clear menu of choices. It may even be helpful to have insurance products with enough flexibility that they can be expanded and decreased based on the size of the business.

    Life insurance for the self-employed needs to take into account a few business-related factors that are different for employees covered by life insurance by their employers. Such coverage ensures:

    # Your business can continue without you
    # Any debt or real estate tied to your business will not be your heirs’ responsibility
    # There will be money to finance a buy-sell agreement that can help someone buy or sell your business, either a beneficiary or a partner.

    The bottom line is that life insurance is necessary — no matter where people are in their career trajectory. Successful life insurance companies will relay this important point well into 2022.

  3. Greater Emphasis on Financial Literacy: Insurance As Part of Retirement/Investment Portfolios Can Close Coverage Gaps
    There’s no denying that Covid-19 impacted the stability of health and finances nationwide for many. Among the hardest hit communities were minority neighborhoods.

    This population was already under-served by the majority of insurance companies, who didn’t adequately explain the importance of life insurance as part of a financial portfolio or retirement fund. Minority communities traditionally haven’t been targeted for messaging that shared the concept of financial literacy.

    Moving into 2022, there will be greater industry change, including new ways of thinking to best serve the needs of vulnerable communities. Successful insurance strategies will incorporate social responsibility with business commitments and close any coverage gaps.

    The Insurance Information Institute is one example of an industry group that is educating member companies about the importance of targeted messaging that shares that life insurance is a way to leave your loved ones in a better financial situation. In April 2021, Financial Literacy Month, they highlighted messaging and initiatives designed to improve financial literacy.

  4. More Technology Tools Will Be Used for People Buying Policies
    Digital transformations continue to occur across many industries, including insurance. Companies are leveraging new technologies to simplify and reach individuals across multiple demographics. In the wake of Covid’s impact on the insurance industry practice of in-person consultations, the sales process has become modernized.

    No longer are in-person meetings the main driver in new insurance packages being purchased. Consumers can now use their smart phones and texts to purchase whole life insurance plans. This tech trend also relates to using big data to do automated underwriting. While before 40% of people would normally go through an automated process, now 70% go through It. Gone are the days where most people need to pee in a cup or have blood drawn to qualify for policies.

It’s a digitally based process now which also takes into account situations like when you’re pregnant and gained weight. Before many women were wrongly denied coverage due to extra baby weight.

Digitization of data will continue to be a focus next year.

The insurance industry, like so many others, continues to use lessons learned from the Covid pandemic in shaping its marketing and selling strategies for 2022.

Written by Lacrecia Cade.

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Lacrecia Cade
With a career that includes being a lawyer, an entrepreneur, a marketing executive, and now President at Atlanta Life Insurance Company, Lacrecia Cade is a strategically disruptive force in the industries she serves. She is a transformative leader, challenger of conventional ideas and always inspires novel approaches.

After practicing law for more than 12 years, specializing in employment, education and insurance, Lacrecia Cade became General Counsel and Chief of Staff at Morehouse College. From that role, she took her experience to Aflac, Inc., where she explored the inner workings of running a Fortune 150 insurance company -- first as a lawyer, and then leading B2B marketing.

Lacrecia Cade is the first Black female president of Atlanta Life Insurance, a storied institution with a clear purpose and legacy of helping underserved communities find pathways to financial protection and generational wealth. Lacrecia embraces opportunities aligned with her personal mission to leave a deep, lasting impact on the world by fueling growth and transformation, all while having fun.

Lacrecia Cade is an opinion columnist for the CEOWORLD magazine. You can follow her on LinkedIn.