How Much Life Insurance Do I Need? Life Insurance Company Websites May Not Be the Best Place to Find Out

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The Customer Respect Group today released findings from its Study of Life Insurance Tools. The study evaluated a vital consumer tool — “How Much Life Insurance Do I Need?”— on the websites of 20 leading life insurance companies, looking at 20 separate attributes to compare the tools across sites. As more consumers go online to research products such as life insurance, understanding how much coverage is recommended is one of those fundamental questions. Insurers report significant tool activity confirming consumer interest. The general conclusion of the study however is that consumers will not gain a clear idea of what the question “How much life insurance do I need?” actually means, let alone get a sensible answer. Complicated language, a huge variation in information requested and coverage amounts suggested, and confusing results presentations were just some of the shortcomings uncovered. Many sites still rely on inexpensive third-party generic calculators that don’t make a good impression or integrate into a logical task flow.

The Customer Respect Group, an international research and consulting firm that focuses on how corporations treat their online customers, today released findings from its Study of Life Insurance Tools.

The study evaluated a vital consumer tool — “How Much Life Insurance Do I Need?”— on the websites of 20 leading life insurance companies, looking at 20 separate attributes to compare the tools across sites.

As more consumers go online to research products such as life insurance, understanding how much coverage is recommended is one of those fundamental questions. Insurers report significant tool activity confirming consumer interest. The general conclusion of the study however is that consumers will not gain a clear idea of what the question “How much life insurance do I need?” actually means, let alone get a sensible answer. Complicated language, a huge variation in information requested and coverage amounts suggested, and confusing results presentations were just some of the shortcomings uncovered. Many sites still rely on inexpensive third-party generic calculators that don’t make a good impression or integrate into a logical task flow.

Select findings

Little consistency — bad for consumers
Comparison-shopping is second nature for consumers. However, anyone who wants a second or third opinion online on how much life cover will encounter significant issues. Input criteria vary substantially, both in terms of the amount of data asked for and the different items asked for in tools of similar length. Worse, the coverage amounts recommended vary drastically with the top-end value typically three times or more that of the bottom value.

Not all calculators are easy to find
Some companies have yet to accept that clear navigation to important tasks needs to be constantly improved. On the other hand, some sites have big colored buttons that lead to calculators and are difficult to miss. Another issue on some sites was links that were good in some areas but absent from others. Furthermore, to signpost to calculators, some sites use terms that would not be recognized as such by most consumers, including “Modal Charge Disclosure And Annual Percentage Rate Calculator,” “Virtual Consultation Calculator” or even “Life Calculator.”

Integration with other tasks is growing but next step is not always clear
Nine sites with calculators also had quote engines, but not every one of the sites offered clear links between them. Just four calculators passed results directly to the first stage of quote engines. Just three sites provided a logical process to pass results to an agent so the process could proceed offline. As for helping consumers move on to other related tasks, many calculators were literally dead ends.

Language help text and design cause confusion
Too many examples of confusing language were found, consisting of two main types: jargon and company-centric terms — e.g., “PV Of Survivor’s Earned Income (adjusted)” and ambiguous wording, “Continue Income at 53%” (of what?). Help text should clarify such matters; while there were some great examples, there were some truly awful ones also. Design issues were centered on clutter and when the layout of a tool was inherently confusing.

Simple or complex — variation in results presentation
Simplicity is the key when showing results. Some companies showed a single result, while others supplied tables of detailed projections covering 25 years or more. A little over half the companies displayed results in the form of graphs, but only two showed charts that updated in real time as data was entered.

The top-performing companies were:

Company    Score (out of 100)
USAA             76
State Farm        72
Allstate             61
Liberty Mutual 57
MetLife             57
ING                 54
Principal Financial 53
AXA Equitable 50
Mutual of Omaha 40
American Family 40

According to Terry Golesworthy, president of The Customer Respect Group, “This is an example of a problem created out of internal conflicts about the true role of the website. There is a long-standing industry belief that consumers cannot or should not self-serve life insurance and need to speak to an agent. We understand the hesitation of many insurers in providing quote engines, but this tool is a natural entry point and an opportunity to reach out and impress the consumer at the research stage. Insurers need to accept that many consumers now prefer to self-serve and take control over the buying process.”

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Terry Golesworthy
The Customer Respect Group
(978) 412-0019
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