In Life Insurance, Omnichannel Has Become a Competitive Necessity

Designing omnichannel consumer experiences is a Herculean challenge that life insurance carriers must meet head-on if they intend to thrive in our digital era. 

Life policies are sold, not bought. While consumers might proactively seek out health or auto coverage, relatively few do the same for life. It’s a remarkably relationship-driven industry — which is why carriers historically relied on a “feet on the street” approach to sales, employing droves of young professionals who could tap their networks to sell policies. 

But amid rapid digitization and a pandemic-accelerated preference for remote engagement, this in-person approach is quickly falling out of favor. According to a 2020 report published by LIMRA, only 41% of surveyed consumers said they preferred to purchase life insurance in-person — a double-digit drop from 2011. Conversely, consumers’ preference for online purchasing increased from 17% to 29% over the same period. 

This isn’t to say that consumers want a one-to-one replacement of in-person interactions with digital. In 2019, McKinsey researchers noted that one in two customers were “multi-access,” choosing to engage with carriers via multiple channels. These findings indicate that consumers want to not only engage with insurers via their preferred channel, but switch between channels as they shop. In other words, they want an omnichannel experience.

Consumers have high expectations for omnichannel experiences

For insurers, providing an acceptable omnichannel is easier said than done. 

“As an industry, we’re being compared to top-tier e-commerce sites,” Michael Plazony, a life insurance industry veteran and partner at MVP Advisory Group, told Gerent. “Today’s customers aren’t just demanding online experiences — they’re calling for Amazon-equivalent levels of efficiency and convenience. We’ve seen incremental improvements over the last decade, certainly. But as an industry, we haven’t improved the shopping experience to that degree yet.”

As Plazony points out, relatively few insurers have risen to meet the omnichannel challenge. A McKinsey report published in January of this year found that while 90% of multichannel carriers facilitate online sales for their home and car policies, only 11% did so for their life insurance products. In addition, most carriers still required face-to-face interaction to finalize a sale. 

There is a clear lack of omnichannel service in the insurance market today — however, the gap comes with a silver lining. Because the insurance sector hasn’t achieved a standard for omnichannel outreach, carriers currently have an unparalleled opportunity to surpass their competitors by providing top-tier cross-channel experiences. 

Turning the omnichannel challenge into a competitive advantage

The untapped market for life insurance is substantial; according to LIMRA’s 2020 Insurance Barometer study, roughly 41 million customers in the U.S. life insurance market express a need for life coverage but do not yet have it. 

So, how might carriers tap into that pool and set themselves above their competitors? The answer lies with omnichannel. Insurers need to proactively meet consumers where they are, design customer journeys that allow for seamless channel-switching, and provide experiences that leverage both the convenience of digital outreach and the compassion of in-person conversation. 

This is no small task; to accomplish it, insurers will need to conduct extensive research into their current consumer base and fully understand the journey consumers take from prospecting to actually becoming a customer — including how many times they assess, research, start, stop, and return to the market. Knowing which and how marketing channels bring leads into the market is crucial, too. 

Then, carriers can further segment their consumer base to tailor products towards specific groups. For example, if an insurer realizes that members of a particular group want similar policies, they can tailor their products and, to a lesser extent, their underwriting to suit the risk classes in that group. That customization, in turn, allows the insurer to tap into the market niche, achieve more uplift, and issue quotes quickly.

The potential for gain is significant — but to realize it, insurers will need data. Consumer segmentation, journey mapping, and nearly every other task involved in developing a consumer-tailored omnichannel approach require a massive amount of consumer information. Designing data-driven experiences can be difficult for insurers if digital structures aren’t built into their organization’s core procedures and approach. 

Salesforce Provides an Omnichannel Answer for Insurers

With Salesforce, embracing an omnichannel approach to sales is intuitive. Salesforce provides a framework for omnichannel; its product suite empowers insurers to tap into their client flow, learn which messaging components or key product aspects drive buying behavior, and seek new growth within their target markets. 

Insurers who implement the technology can readily assess, customize, and refine their customer journey and experience. Specific tools such as Einstein and Tableau can give companies an AI-enhanced ability to deploy analytics and build effective outreach models. This, in turn, can empower insurers to spend their marketing dollars on the channels that will provide the highest lift. 

Salesforce and Salesforce Industries are the most holistic cloud-based platforms on the market. They provide insurers with the CRM support they need to leverage their data capabilities fluidly across channels — and most importantly, stay atop the omnichannel challenge. 

Not sure how to launch your omnichannel transition? Download our whitepaper or contact Gerent for tailored advice and guidance!

No items found.
green background

Ready to reinvent the future?

Get Started

More from Gerent

Follow Us