Be in Pole Position: Align Marketing and Distribution

May 2025

Memorial Day Weekend marks the unofficial start of summer, bringing with it a three-day celebration filled with parades, barbeques, and most importantly, time to honor and pay tribute to our country’s fallen soldiers. For many, this weekend also signifies race weekend. For nearly five decades, the iconic Indianapolis 500 and NASCAR Coca-Cola 600 have been held on the Sunday of Memorial Day weekend.

Every member of the racing crew, including the driver, engineers, mechanics and pit crew, understands the importance of proper alignment. Working together enhances performance. To win the race, everyone and everything must be in perfect alignment.

Over the past decade, life insurance sales have been idling. Premiums have increased, but overall, policy count has remained flat, which means fewer people and families are protected.

Recent research conducted by LIMRA and Bain & Company looks at how fine-tuned alignment and collaboration between marketing and distribution can help address this gap and accelerate growth.

Closing the Gap

Over the last 10 years, the gap in life insurance protection has widened significantly, affecting over 40 percent of U.S. adults. More than 100 million adults acknowledge they need life insurance but still find themselves without enough coverage, or none at all. Notably, this isn’t just a problem for the middle market — it’s a widespread issue that touches every segment of society.

Adding fuel to the issue is the disconnect between access and perceived affordability, which stalls the conversion of interest and awareness into action. Most consumers want to understand life insurance before making a purchase. They act in response to their need by most commonly researching options online, consulting with friends and family, and even obtaining quotes and/or engaging with a financial professional (FP). The hesitation in purchasing life insurance comes from misconceptions about affordability. Almost 75 percent of U.S. adults overestimate the true expense of a standard term life insurance policy, with 50 percent of Gen Z and Millennials estimating the cost to be over three times higher than it actually is. Shopping behaviors of the younger generations are different, particularly with the use of social media as a source of information. There is an ongoing need for effective education to meet the needs of these younger generations in the purchase funnel.

Staying the Course

Like a well-coordinated pit crew ensures the driver stays on track and reaches the finish line, marketing and distribution can collaboratively tackle the obstacles and challenges that consumers face. Financial professionals (FPs) are crucial for conversion, yet consumers often struggle to access them. Many prospects wish to consult with a financial professional before purchasing life insurance, but few do.

Trust and cost are the two significant issues consumers deal with when looking for an FP to work with, similar to a driver needing their pit crew and clarity on the racing strategy. They find it difficult to find an FP they trust and are unclear about the cost of engaging with an FP. Marketing can bridge this gap by enabling consumers to self-educate and connecting them with a suitable financial professional. Transparency around cost, as well as meeting and engaging with prospects where they want — via text, virtual meetings or in-person, for example — will also help.

Distribution-Driven Marketing Tactics

A company using affiliated distribution will spend its marketing budget differently than one with independent distribution. From a marketing perspective, customers can be seen as consumers (potential policyholders), their wholesalers, financial professionals or intermediaries such as brokerage general agencies (BGAs), independent marketing organizations (IMOs), banks or broker-dealers. Carriers can support FPs with better lead generation and invest in “ease of use” processes and technologies to make doing business as smooth and efficient as possible, like a well-oiled pit stop. Some carriers invest their marketing spend in making their products more competitive, as this aligns with the desires of their distributors, rather than focusing on consumer marketing. Additionally, some carriers rely on their wholesalers to ensure alignment with marketing decisions, as bringing a concept to market without their support would not be advisable.

Companies leveraging independent distribution can strategically allocate their marketing budget to intermediaries and financial professionals. They have the option to either expand their reach to more FPs or increase their share of each FP’s book of business. Just like a race car driver, balancing speed and control, adopting a balanced approach can accelerate growth. They also understand that even if they provide lead generation to FPs, they may not achieve a 100 percent return on their investment. However, securing some business from leads is preferable to gaining none at all.

The Winning Formula

Like navigating a high-speed racetrack, deciding where to spend marketing dollars is a complex task. Various factors need to be considered, including company goals, strategies, target markets, and, of course, distribution channels. Carriers seem to be focusing primarily on the top of the marketing funnel — raising consumer awareness of the company. The goal is to guide them through the funnel to the point of making a purchase. However, carriers are losing consumers in the middle of the marketing funnel. Enhancing awareness, providing education, facilitating connections with an FP, and improving website engagement to encourage further action will help push consumers deeper into the funnel.

Conclusion

Who is in the driver’s seat? Is it marketing, distribution, the financial professional or the consumer? The answer is all of them. Much like everyone involved in a professional race car crew, they must work together in perfect alignment for everyone to succeed. As the legendary Enzo Ferrari said, “What’s behind you doesn’t matter.” Looking ahead, aligning distribution and marketing can accelerate growth, but more importantly, it can help protect more families, and that is a race worth winning.

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