WINDSOR, Conn., Oct. 2, 2013 — A recent LIMRA study revealed that 76 percent of Canadians would prefer to buy life insurance face-to-face in the future as opposed to buying from work, the Internet, or by direct mail or phone.
That was one of the key findings from the 2013 Canadian Life Insurance Ownership Study which monitors long-term patterns in life insurance ownership, adequacy of coverage, and consumers’ attitudes about life insurance.
“Our research found that six million Canadians believe they need more life insurance and three quarters of those we surveyed would prefer to buy it face-to-face,” said Cheryl Retzloff, senior research director for LIMRA. “These findings should suggest a high potential for increased sales. When we asked what keeps consumers from buying life insurance, the top-two reasons given were: low priority and a perception that it’s not affordable.”
Of the 1 in 4 Canadian households that prefer to purchase through non-face-to-face methods, the Internet was the most popular (11 percent), followed closely by workplace and direct by phone or mail. By comparison, in the United States 43 percent say they prefer to buy through their worksite or direct. (See chart)
While Canadian consumers may prefer personal contact, LIMRA’s Canadian Recruiting Trends data shows that 14 percent fewer sales professionals were recruited in 2012 compared to five years earlier (13,500 versus 15,600). This combination of fewer agents and slow adoption of non-face-to-face purchasing creates a real challenge for Canadian insurance companies.
Other key findings from the report:
- Only 68 percent of Canadian households have any life insurance at all compared to 79 percent in 2006.
- Among those polled, the top financial concern is the government’s ability to fund health care in which 84 percent answered “very” or “somewhat concerned.”
- Eight in ten Canadians worry about having enough money for retirement. The same percentage also expressed concern over the cost and availability of long term care.
- Married households with children under age 18 are underinsured —
- 3 in 4 said they would have difficulty with living expenses if a primary wage earner were to die.
Retzloff added, “Since 2006 (the last time LIMRA conducted this study), Canadians have lived through a recession resulting in less discretionary income for most people. Given that environment, it’s not surprising to see overall life insurance ownership decline.”
This year’s Insurance Ownership Study surveyed more than 3,200 Canadian household financial decision makers. The results were weighted to represent all Canadian households.
LIMRA, a worldwide research, consulting and professional development organization, is the trusted source of industry knowledge, helping more than 850 insurance and financial services companies in 73 countries increase their marketing and distribution effectiveness. Visit LIMRA at www.limra.com