In addition to the proliferation of life insurance software, a trend that has gained popularity in recent years is that of unbundling insurance packages and offering greater personalization. The latter not only refers to the mixing and matching of life insurance components, however—it also refers to a more personal approach to marketing. While more traditional insurance companies may be hesitant to put such a strategy in place, there are a few compelling reasons to consider doing so:
Traditional Pre-set Packages Simply Do Not Meet Customers’ Needs
Unfortunately, many of today’s potential customers find traditional one-size-fits-all insurance plans to be unattractive or even unnecessary. Indeed, it’s difficult enough to convince young and fit individuals that they should invest in an insurance plan, much less encourage them to learn about their options by meeting with an agent.
Even then, many companies put much of their time and attention toward trying to communicate the importance of these packages to a market that simply does not recognize its value. Continuing to go down this route will only be a waste of valuable resources.
Instead of chasing after young markets with the usual all-in-one packages, a more practical approach would be to re-examine existing offerings and modify them to better address actual market needs and wants. Better yet, insurance companies can take this a step further by unbundling packages and allowing potential customers to mix and match components, allowing them to build a plan that truly works for them on a more granular level.
Flexible Offerings Can Attract Underserved Markets
For most life insurance companies, the best customers to target are working professionals between around 30 to 50 years of age. It makes perfect sense, given that people within this age range are typically looking to marry, purchase their very own home, and start their own families. In fact, most pre-set life insurance plans are usually developed with this target market in mind.
That being said, focusing mostly on this demographic with the usual packages may cause insurers to lose out on attracting underserved markets. This includes, but is not limited to, people who make a living in the gig economy, working professionals belonging to the Millennial generation, as well as senior and non-salaried customers. Why is that, though?
In the case of gig workers, they often do not have access to group or company benefits due to the more contractual nature of their work. As for Millennials, nearly 80 percent of those based in the United States do not have adequate life coverage. This is mostly because they feel that pre-packaged plans do not serve their individual needs. Lastly, the aging population—typically considered to not be a profitable market for life insurance—now have longer life expectancies, and are thus interested in insurance packages that can offer them alternative value.
For these reasons, it would do your company well to be the first to address their unique needs before the competition. A sure-fire way to do this is to provide them with more flexible life insurance options, ones that better match their budget and circumstances.
Potential Customers Seek More Personalized Experiences
Back in the day, a more generalized approach was often enough to satisfy most insurance clients. These days, however, customers are becoming much more technologically savvy, especially those who grew up surrounded by digital products and services. Because they can search for whatever they want with the click of a button or a tap of a screen, though, they also have access to much more information than ever before.
Armed with new knowledge, today’s customers are now much more discerning of insurance providers and their offerings. These customers are also quick to notice if agents are simply using the same spiels without much consideration for their specific life circumstances or desires. They also do their due diligence when it comes to research and have likely made up their minds regarding more traditional pre-bundled offers.
Because of this, insurers should abandon generic spiels and instead, take the time to get to know their potential clients. This can come in the form of personalized emails or videos, wherein the customer truly feels like they’re being addressed directly rather than being another face in the crowd. Unbundling packages and allowing for plan customization also empowers them, in a way, to make their own decisions regarding what they feel they truly need. By giving people a more holistic and personalized experience, they will sense that your company truly cares about their wellbeing, and they’ll be more likely to convert into customers.
It’s about time that insurers finally abandon the older, more traditional ways of the past and offer much more customizable packages for their members, both new and old. Indeed, today’s technology provides them with an opportunity to rethink their current processes, products, and services, and rework them to better serve their market’s needs. By doing so, insurance companies will not only be able to survive short-term bumps in the road, but they will also be able to weather any storms in the long run.
