Life Insurance

Life Insurance:

 (Business Wire) TROY, Mich. With the greatest term lengths of long-term investment and insurance products, individual life insurance and annuity products have an issue with consumer engagement. The J.D. Power 2022 U.S. Individual Life Insurance StudySM and the J.D. Power 2022 U.S. Individual Annuity StudySM, both released today, show that customer satisfaction with these products begins to decline relatively soon after purchase, which not only reduces the likelihood that these customers will consider purchasing other insurance and financial services products, but also results in a general lack of understanding of the products they already own.

The prize winners in both studies, State Farm and American Equity Investment Life Insurance, defy the trend and show some of the highest year-over-year increases in customer satisfaction, despite the fact that the industry is declining.

Life Insurance:

According to Robert M. "After a brief surge during the height of the pandemic, overall customer satisfaction with individual life insurance and annuity plans has now reverted to their previous long-term trends, in which customer satisfaction declines as tenure with the product increases," says Lajdziak, director of global insurance intelligence at J.D. Power.

Lajdziak, J.D. Power's director of global insurance intelligence Our data clearly show that insurers are having trouble keeping in touch with consumers on a frequent basis and reinforcing a distinctive value proposition over the course of the relationship. As a result, incumbents face a competitive threat from insurtech start-ups that are utilising digital to give a more multi-channel approach to client engagement that is popular with customers, which limits possible future sales opportunities.

The 2022 study's primary findings are as follows:

Customer contentment declines: The overall satisfaction with individual life insurance drops two points to 774 (on a 1,000-point scale) this year, following the highest one-year improvement in customer satisfaction in 2021, with falls in interactions with agents/advisors, the call centre, and the website taking the lead. Similarly, customer satisfaction with individual annuities falls 13 points to 789, with communications, product offers, and price satisfaction all experiencing significant drops.

The long tail of declining satisfaction with life insurance: Customers' overall satisfaction declines the longer they hold a life insurance coverage. Customers who have been with a company for five years or fewer have an overall satisfaction rating of 821. After six years, seven years, and eleven years, it drops to 785, 759, and then 756.

Digital is currently the preferred mode of communication, yet advisor/agent touch is still important: Within half (51%) of customers have interacted with their insurer through at least one digital channel over the last three years. Compared to customers who haven't used a digital channel, these customers are more satisfied.

Annuity companies underusing digital Annuity providers are progressively delivering customer messages via mail despite the great prevalence of digital consumer connection. Even though 74% of annuity clients got mail as a means of client communication this year, it had the lowest overall satisfaction ratings. In comparison, only 8% of people utilise mobile applications, but they are responsible for the highest levels of customer satisfaction.

Insurtechs have more opportunities due to a lack of brand uniqueness. More than half (55%) of life insurance clients compare their own insurer's brand reputation to that of other insurers in the market. Customers are more inclined to regard insurtech brands as distinctive, inventive, and reasonably priced, though.

Research Rankings

For the second year running, State Farm tops the list of companies offering individual life insurance, earning a score of 839. Mutual of Omaha (801) is ranked third, while Globe Life (812) is ranked second.

With an 838 rating, American Equity Investment Life Insurance tops the list of individual annuity suppliers. Nationwide (822) is in third place, followed by Fidelity & Guarantee Life (829) in the rankings.

The 2022 U.S. Individual Life Insurance Study evaluates the customer experiences of the biggest U.S. individual life insurance providers. According to performance in five categories—communication, engagement, price, product options, and statements—the study gauges total consumer satisfaction. 5,583 individual life insurance clients responded to the survey, which was conducted in 2022 from June to August.

Life Insurance:

The largest annuity providers in the United States measure their customers' experiences in the 2022 U.S. Individual Annuity Study. Performance in five factors (listed alphabetically) is used to determine overall customer satisfaction.Price, interactions, product offerings, comments, and communication. The study was conducted from June through August 2022 and is based on replies from 3,152 unique annuity clients.

Regarding J.D. Power

In terms of consumer insights, advisory services, data, and analytics, J.D. Power is a world leader. J.D. Power has been providing insightful industry intelligence on consumer interactions with brands and goods for more than 50 years. The company is a pioneer in the use of big data, artificial intelligence (AI), and algorithmic modelling capabilities to understand consumer behaviour. Leading companies worldwide rely on J.D. Power to direct their customer-facing strategies across key industries.

North America, Europe, and Asia Pacific are all home to J.D. Power offices. Visit JDPower.com/business to find out more about the company's business offerings. JDPower.com hosts the J.D. Power auto shopping tool.