People shop for car insurance whenever they purchase a new vehicle, or pay off an auto loan. They begin to compare homeowners insurance rates while still looking for their dream home. But how do people begin the search for life insurance?
According to a joint project conducted earlier this year by LIMRA (the Life Insurance Marketing and Research Association), roughly 20% of the life insurance policies sold in 2008 – and about 5% of the premium – were sold via direct channels.
In an article posted in a the Life Insurance Blog, last March, Ron Neyer, senior analyst for LIMRA was quoted as saying, “For the first time, we have been able to quantify the amount of individual life insurance sold through direct channels, like the Internet, direct mail and telephone.”
In fact, LIMRA and LIMDA researches estimate that direct channels were the source of more than 2 million individual life insurance policies sold in 2008, and account for a total of $675 million in new premium in the same fiscal year.
Since 2006, the number of consumers using the Internet to purchase life insurance has doubled. The key factors influencing these buyers were convenience, price, and the quality of the website. As technology continues to advance, industry researchers predict that even more consumers – especially those in younger generations – will use direct channels to purchase their coverage over the next five to ten years.