Superior service via has been and always will be the key to building a client base in the life insurance industry.
But what constitutes great service is undergoing a major shift in the digital era. This shift is no different than what has occurred in the wealth management space over the past two decades. Therefore, the digital transformation of the wealth management industry is a leading indicator of what should happen in life insurance.
Only a few years ago, insurance advisors just needed a website and availability via phone and email to be successful. However, today’s consumers are increasingly tech-savvy. They are looking to engage with businesses that are on the same playing field. Customers want the ability to connect anywhere at any time and gain continued value without investing a lot of energy.
Despite the growing demand for greater connectivity, the life insurance industry has not listened. We have now reached a critical point. If advisors want to improve client relationships and grow their agencies, they need to adapt. This is even more critical when looking at future generations. While children should be one of the strongest referral sources, 60% or more choose not to use their parents’ advisor for their financial or life insurance needs, (For more on this, read Break the Rule of 66.)
With a projected $41 trillion passing from Baby Boomers to their children and grandchildren, this isn’t an opportunity you want to miss. Staying connected through insurance technology is vital to a loyal customer base and will maximize referrals among the upcoming generations.
What Connectivity Looks Like for Life Insurance
There’s no doubt that disrupting a highly regulated industry comes with challenges. But as seen in the wealth management field, the benefits are substantial. Research from McKinsey found that wealth managers who adopted digital tools to connect with clients had client satisfaction 5 to 10 times higher than that of traditional wealth managers. Not to mention, clients who engaged through a mobile experience were 3.5 times more likely to move assets than those using other channels.
For the life insurance industry, connectivity doesn’t mean occasional emails or even a website where policyholders can log in and view static versions of their life insurance documents.
The key to staying connected with clients is a digital platform that serves as a connectivity hub. If done correctly, it can provide significant value to the advisor as well as their clients.
Below are just a few elements of key components in a successful platform.
Three Ways It Must Benefit Clients:
Communication central. A digital life insurance platform opens a constant line of communication between clients and advisors. Clients can contact their advisor directly through the site, and advisors can share any policy updates in real-time.
Digital storage and file-sharing. The platform serves as secure digital storage for clients’ life insurance policies and other important financial documents. Also, clients can allow loved ones to gain access to the platform any time before or after their passing to ensure everything gets to the right people.
Memory bank. In addition, clients can save traditions, photos, videos, and memories on the platform. These personal details all incredibly important parts of their legacy.
Three Ways It Must Benefit Advisors:
Growth. Advisors can use a digital platform to fuel agency growth through client networking. When clients add family and friends to the platform, more people know and are connected with you and your agency. Instead of spending valuable time and resources prospecting new clients, your current clients bring prospects right to your door.
Insights. Smart technology provides you with valuable insights into your clients’ ever-changing needs. For example, it will let you know how and when to reach out to your clients for additional service.
Secure Connectivity. Advisors need an easy and secure method to share information. While secure email is one method, it lacks storage and bilateral communication capabilities. A platform that provides secure sharing, collaboration, and storage of materials provides significant value. Firstly, the client receives the seamless experience they desire. In addition, the advisor can keep information secure and readily accessible for all parties involved in a compliant way.
The entire life insurance industry will be adapting to a more digital model in the coming years. Those who transition now will survive and thrive by staying ahead of the pack. To learn more about Insurtech and what changes to expect in the 2020s, check out INSURTECH: THE DISRUPTED AND THE DISRUPTER.