The Rise of Millennials and an Aging Population
Life insurance for someone in their 20s is likely to look very different from a policy held by someone in their 60s, and for good reason. As your income, debts, assets, and family size change, so does the level of coverage you need. Life insurers are learning how to tailor products for a wide range of consumers so everyone can get the protection they need for their life stage.
Millennials and Life Insurance
Millennials have surpassed Baby Boomers as the demographic who makes the most and spends the most, but that doesn’t mean they have the same needs or expectations. The online experience matters to the age group, who were born between 1981 and 1996. As a result, life insurers are adapting their websites and mobile apps to keep up with the times.
Life Insurance for an Aging Population
It’s no secret that Australians are living longer than ever before, which impacts the medical system and the life insurance industry. Older Australians may have paid off more of their debts, which reduces the amount of life insurance they need. On the other hand, it also means that people covered under Total and Permanent Disability insurance need coverage longer, which can be less sustainable for life insurers.
Technology, Data Analysis, and Life Insurance
We mentioned that millennials are driving the demand for functional mobile apps and online platforms, but that’s not the only way technology affects life insurance trends. Insurers moving into the online sphere is good news for consumers, who gain easier access to their policy information
Customers can now manage their policies online, which includes making an initial application, changing their level of coverage and even making a claim. As the process becomes more
streamlined, more people are taking the time to shop around for life insurance, which could help ensure that more Australians are adequately insured.
New medical technology gives us more information about individual health, and this data can be used to create a more personalised life insurance product. Insurers can use data analysis in insurance underwriting, which could lead to a faster approval process.
A Whole Life Experience
Life insurance is no longer focused solely on life for your loved ones after a death or trauma. These days, insurers are also focused on achieving a whole life experience for their customers. Many insurers have implemented health and wellness programs that focus on improving your quality of life right now.
Customers are encouraged to improve their health in a range of ways, such as access to discounted gym memberships or by earning points through healthy activities like visiting your doctor. Insurers can also collect this information from their customers and use it to develop products that offer more value.
Insurers can help customers avoid injury or return to work more quickly after an injury or illness, which is a better outcome for both sides.
Sustainable Life Insurance
Sustainable life insurance is a policy that provides a benefit for both the insurer and the customer. If a product costs too much, customers won’t buy it. However, if the insurer consistently loses money on a product, that doesn’t work either.
Certain life insurance products, such as Total and Permanent Disability (TPD) cover, are leaving insurers with substantial losses. On one hand, this shows that the products are doing their job for consumers, and claims are being paid out.
On the other, TPD insurance may be an unsustainable product for insurers, who are then forced to raise the premium on other products, such as term life insurance, to make up the difference. It’s not a lasting solution, as many Australian families are already struggling with the higher prices of life insurance.
This trend could swing in a positive direction by prompting insurers to develop a wider range of products at varied price points. Consumers would then have more choice and be better able to select a policy that meets their specific needs.
Placing Your Trust in Life Insurance
Australians are struggling to trust life insurers, which has resulted in some conflicting views. While Australians are generally able to see the value in life insurance, they may still be lacking the level of insurance they need.
This is partly due to a lack of trust in the life insurance industry, along with a level of confusion about the complex policies on the market. Australians seem hesitant to take out the right level of cover because they don’t trust the system.
It can be hard to trust a system that is designed to make a profit, but it’s also in place to protect your family’s finances. On the whole, life insurance policies consistently pay out on valid claims, which has made a difference to many Australian families.
The trends of not having enough life insurance and low trust in insurers are closely linked, but they present an opportunity for insurers to do better. With the public keeping a close eye on life insurance, insurers are having to step up their game by providing better products at a reasonable price point, along with clearly defined policies that are easier to understand.
Shopping Around for Life Insurance
As technology increases and Australians search for an insurance policy they can rely on, online price comparison has become a popular option for buying life insurance. Comparing policies helps customers find the features they’re looking for at a lower price, rather than just taking what is offered by a single insurer.
Life insurance trends will likely continue to shift, but the demand for a good quality product that offers value for money remains strong.