Why do people shop for life insurance? In the United States, we know that seminal life events like getting married, having children and buying a home are some of the top reasons. But what about actually buying it? Is it an ad, a recommendation or something else that sets things in motion?
LIMRA headed south for a recent study, and from its results, we’re learning more about what prompts people to actually buy life insurance in Latin America, a place where there is great potential and opportunity for financial professionals.
A new LIMRA study of the life insurance market there has found that the majority of consumers who bought in the past two years were prompted to do so by recommendations from their family members or friends.
The survey investigated the marketplaces in four Latin American countries: Brazil, Chile, Mexico and Peru, and found that the top triggers to purchase are personal and social in nature. Those who bought three or more years ago were most likely to do so because of something a salesperson told them.
The report paints a comprehensive picture of preferences, behaviors and best practices in the region from the perspective of companies. Meeting Consumer Needs in a Growing Life Market also reveals why companies are developing new products, with the majority saying the top reason is to meet a newly-discovered consumer need (see chart).
It also sheds light on some of the ways companies are trying to make an ethereal product like life insurance more tangible in the minds of consumers.
Life insurance products tend to be complicated — and the full benefit may not be realized for many years. With that in mind, companies are trying new things to make their products more relevant, according to the study. Some companies are using welcome calls for new clients, offering discount programs in stores, awarding gifts with in-force policies and naming products after the benefits that the products can bring about.
And when consumers realize how valuable life insurance can be for them and their families, LIMRA research has consistently found that they are more likely to purchase, and as a consequence, secure their family’s financial future.
LIMRA partnered with Fasecolda to survey 14 companies in the winter of 2014 and 2015.