Navigating the Shifting Life Insurance Landscape

By: Alison Salka, Ph.D., Senior Vice President and Director of Research, LIMRA and LOMA

September 2023

By all accounts, it seems, our world remains unsettled. The disruptions that shake the globe have a lasting impact on all aspects of our personal lives and the business environment.

The life insurance sector is clearly no exception. Factors such as pandemic aftershocks, economic volatility, rapidly emerging technologies, climate events, population change and geopolitical conflict each play a role in the evolution of the industry. This complex combination of forces is at work daily, shaping the life landscape.

The Backdrop

Recent life sales trends have not been encouraging. Despite a lift in sales during the COVID-19 pandemic, overall ownership has been declining over the last decade. If current trends continue, less than half of U.S. adults will have coverage by the end of this year.

Sales clearly begin with consumer awareness of their need for protection — as well as the motivation to follow through with the process. However, once awareness is achieved and appropriate products are available, distribution and technology must come into play to enable the sales themselves.

Unfortunately, distribution growth has not kept pace with population growth. The continued success of the industry depends greatly on maximizing the efficiency and reach of its distribution channels. Distribution strategies matter more now than ever — and they are becoming less monolithic. More flexible approaches, such as digital platforms and embedded insurance, represent explorations into ways to expand distribution.

At the same time, private equity firms now view insurance distribution as an attractive investment opportunity, which is driving consolidation and aggregation of market power. This means carriers need to be more effective. To begin, it is beneficial to look at their business from the outside in — like banks and retailers do — rather than from the inside out. ?

Key Themes

Four broad themes reflect the forces at work in the current life insurance landscape: ...

Ready to learn more? Click?here to read the rest of the article.

Haven't subscribed to MarketFacts yet? Click?here?to subscribe now.