Whenever we write tips about how to save money on insurance, we always mention bundling home and auto insurance with one company, and then explain that you can increase your savings by adding life insurance to try and get a cheap life insurance policy under the same company, as well.
Nevertheless, the Insurance Cross-Purchase Survey, recently conducted by the insurance industry organization LIMRA, found that while 95 percent of the companies mentioned in the survey are multi-line insurers (providing more than one type of coverage) offering life insurance, fewer than half of their customers – 48% to be exact – are actually aware this type of coverage is offered. As well, the survey found, 87% of insurance customers had never spoken to their insurance agent about life insurance at all.
According to Laura Murach, assistant director, LIMRA Distribution Research, this represents an “obvious disconnect” between clients and insurance agents. Past surveys showed that clients had previously been approached about all of their auto/home/life insurance needs, generally during their first conversations with an agent.
In a press release sent out by LIMRA about these survey results, Murach considered the possibility that agents were mentioning cheap life insurance options to their clients, but that they weren’t doing so in a way that caused customers to respond favorably, or even to remember the conversation. The survey looked at the responses from 4,000 people who were asked about their insurance purchasing habits and what made them buy or not buy life insurance coverage from their multi-line insurers.
In addition to the numbers cited above, the survey also found that while 63% of respondents do have some kind of life insurance coverage, only 19% purchased it from the same company that covers their automobiles. As well, the survey responses said, roughly a third of people who buy life insurance from a company other than their auto insurance provider do so because they aren’t aware the product is available from their existing insurers.
While the cross-selling of life insurance to property-casualty customers has been a standard part of industry strategy since the inception of multi-line insurers, LIMRA research shows that of the 64.3 million households that have coverage from one of the 13 multiple-line, exclusive-agent (MLEA) companies, only eight percent of them have their auto, home, and life insurance (or financial products) with the same company.