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Life Insurance - US - September 2014

“Life insurance is not a product people like to buy and ownership rates continue to fall. Continued low interest rates aren’t helping, and neither is the fact that many people feel it is better to save money than it is to pay insurance premiums. It is no coincidence that life insurance sales are down at the same time that the demographics of America are changing. Women, unmarried individuals, and Hispanics all have low rates of life insurance ownership, and all are growing segments in the US. Life insurance companies have to make their products attractive to these groups if they want to begin stemming the tide.Changing demographics offer both challenge and opportunity as companies struggle to find a way to bolster sales.”

– Robyn Kaiserman, Financial Services Analyst

This report covers the following issues:

  • Life insurance is increasingly important for women
  • The changing definition of "family" offers other emerging markets
  • How can life insurance companies attract Millennials?
The Market:

The total number of insurance policies purchased dropped 3.9% from 2002-12 and 5.9% from 2011 to 2012, which is not a particularly good sign for the industry.
The number of policies in force has declined over the past decade as well, though with a drop of only 1.5% over that time period, the decline has not been quite as dramatic.
 
Clearly, consumers are questioning the value of life insurance and, because it is primarily younger people who initially purchase policies when they get married and start families, it would seem that young people comprise a good percentage of the segment that is turning its back on the product.

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Consumer survey data
        • Direct marketing creative
          • Abbreviations and terms
            • Abbreviations
              • Terms
                • Generations
                • Executive Summary

                    • The market
                      • Fewer policies being purchased
                        • Number of insurance companies is declining
                          • Figure 1: Number of total life insurance companies in US, 1988-2012
                        • Market drivers
                          • Figure 2: Year-over-year monthly percentage change in life insurance applications, by age, January 2014-June 2014
                        • Low interest rates
                          • Figure 3: Treasury yields, Jan. 1, 2014-Aug. 11, 2014
                        • Leading companies
                          • The consumer
                            • More women need life insurance
                              • Figure 4: Percentage who don’t have life insurance, by gender, June 2014
                            • Hispanics less likely than non-Hispanics to have life insurance
                              • Figure 5: Percentage who don’t have life insurance, by Hispanic origin, June 2014
                            • Marriage is a major impetus
                              • Figure 6: Percentage who don’t have life insurance, by marital and parental status, June 2014
                            • Millennials are willing customers, but need help
                              • Figure 7: Attitude about insurance, by age, June 2014
                            • Most are interested in features that save money, not add coverage
                              • Figure 8: Interest in features, June 2014
                            • Mobile access to accounts is most important
                              • Figure 9: Mobile apps of most interest, by age, June 2014
                            • What we think
                            • Issues and Insights

                                • Life insurance is increasingly important for women
                                  • Issues
                                    • Implications
                                      • The changing definition of “family” offers other emerging markets
                                        • Issues
                                          • Implications
                                            • How can life insurance companies attract Millennials?
                                              • Issues
                                                • Implications
                                                • Trend Application

                                                    • Inspire Trend: Who are the Joneses?
                                                      • Inspire Trend: Prove It
                                                        • Inspire Trend: Cam Cam
                                                        • Market Size

                                                          • Key points
                                                            • Total premiums show slight decline over the past year
                                                              • Figure 10: US life insurance premiums, 2009-13
                                                            • Direct premiums written are down
                                                              • Figure 11: Direct premiums written, life insurance, 2009-13
                                                            • Number of policies continues to fall
                                                              • Figure 12: Number of policies purchased and in force, 2012 vs 2002 and 2011
                                                              • Figure 13: Individual life insurance growth rates, by product, Q2 2013 vs Q2 2014
                                                              • Figure 14: US monthly percentage change in life insurance applications, January 2014-June 2014
                                                          • Market Drivers

                                                            • Key points
                                                              • The aging of America
                                                                • Figure 15: US population projections, by age groups, 2015-55
                                                                • Figure 16: Year-over-year monthly percentage change in life insurance applications, by age, January 2014-June 2014
                                                              • Low interest rates
                                                                • Figure 17: Treasury yields, Jan. 1, 2014-Aug. 11, 2014
                                                              • More single heads of household and unmarried couples
                                                                • Figure 18: Households, by type, 2000, 2010
                                                                • Figure 19: Percentage who don’t have life insurance, by marital status, June 2014
                                                                • Figure 20: Percentage without life insurance, by marital and parental status, June 2014
                                                              • Breadwinner moms are on the increase
                                                              • Competitive Context

                                                                • Key points
                                                                  • Increasing competition from alternate distribution channels
                                                                    • Figure 21: Percentage interested in buying life insurance from an alternate outlet, by generation, February 2014
                                                                  • Fewer insurance companies
                                                                    • Figure 22: Number of total life insurance companies in US, 1988-2012
                                                                  • Leading life insurance companies
                                                                    • Largest by total assets
                                                                      • Figure 23: Top 10 life insurance companies, by total assets, as of December 31, 2012
                                                                    • Largest by individual life insurance in force
                                                                      • Figure 24: Top 10 life insurance companies, by individual life insurance in force, as of December 31, 2012
                                                                    • Largest by group life insurance in force
                                                                      • Figure 25: Top life insurance companies, by group life insurance in force, as of December 31, 2012
                                                                    • Largest by total life insurance in force
                                                                      • Figure 26: Top 10 life insurance companies, by total life insurance in force, as of December 31, 2012
                                                                    • Largest by total net life insurance premiums
                                                                      • Figure 27: Top 10 life insurance companies, by total net premiums, as of December 31, 2012
                                                                    • MetLife
                                                                      • Prudential
                                                                        • Manulife Financial (John Hancock)
                                                                          • AIG
                                                                            • Northwestern Mutual
                                                                              • New York Life
                                                                              • Innovations and Innovators

                                                                                • Key points
                                                                                  • MetLife’s new product makes life insurance easier to get
                                                                                    • MetLife changes its Walmart approach
                                                                                      • Figure 28: MetLife kiosk at Walmart television ad, 2014
                                                                                      • Figure 29: MetLife life insurance print ad, 2013
                                                                                    • Northwestern Mutual reaches out to young Millennials
                                                                                    • Marketing Strategies

                                                                                      • Key points
                                                                                        • Direct mail volume trending down
                                                                                          • Figure 30: Estimated life insurance direct mail volume, January 2013-June 2014
                                                                                        • Mailing volume concentrated among top three mailers
                                                                                          • Figure 31: Top direct mail insurers estimated mail volume, Q2 2013 vs Q2 2014
                                                                                        • Brand analysis: MetLife
                                                                                          • Figure 32: Brand analysis of MetLife, 2014
                                                                                          • Figure 33: MetLife “Private Client Group” television ad, 2014
                                                                                        • Website
                                                                                          • Direct Mail
                                                                                            • Figure 34: MetLife term application direct mail piece, 2014
                                                                                            • Figure 35: MetLife “Guaranteed Issue Whole Life” direct mail ad, 2014
                                                                                          • Email
                                                                                            • Figure 36: MetLife “Simplified Issue Term Life” email ad, 2014
                                                                                            • Figure 37: MetLife “Be a hero” term life insurance email ad, 2014
                                                                                          • Online
                                                                                            • Figure 38: MetLife “Final Expense” online ad, 2014
                                                                                          • TV
                                                                                            • Figure 39: MetLife “National Anthem” television ad, 2014
                                                                                            • Figure 40: MetLife “Football Players National Anthem” television ad, 2014
                                                                                          • Video
                                                                                            • Figure 41: MetLife term insurance video, 2013
                                                                                            • Figure 42: MetLife feature story life insurance video, 2014
                                                                                          • Brand analysis: Prudential
                                                                                            • Figure 43: Brand analysis of Prudential, 2014
                                                                                          • Website
                                                                                            • Direct mail
                                                                                              • Figure 44: Prudential’s group insurance direct mail ad, 2014
                                                                                            • Email
                                                                                              • Figure 45: Prudential term life email ad, 2014
                                                                                              • Figure 46: Prudential e-Pay email ad, 2013
                                                                                            • Television
                                                                                              • Figure 47: Prudential “Day One” commercial, 2013
                                                                                              • Figure 48: Prudential “Stickers” commercial, 2014
                                                                                            • Video
                                                                                              • Figure 49: Prudential’s “Day Two” video, 2014
                                                                                            • Brand analysis: State Farm
                                                                                              • Figure 50: Brand analysis of State Farm, 2014
                                                                                            • Website
                                                                                              • Direct mail
                                                                                                • Figure 51: State Farm multiline discount direct mail ad, 2014
                                                                                                • Figure 52: State Farm “Sells Life Insurance” direct mail ad, 2014
                                                                                              • Print
                                                                                                • Figure 53: State Farm “Handprint” print ad, 2013
                                                                                              • Online
                                                                                                • Figure 54: State Farm “Get to a Better State” online ad, 2013
                                                                                              • Television
                                                                                                • Figure 55: State Farm “Chris/Cliff Paul” television ad, 2014
                                                                                                • Figure 56: State Farm “Nike” television ad, 2013
                                                                                              • Video
                                                                                                • Figure 57: State Farm’s “Learning about Life Insurance” video, 2014
                                                                                                • Figure 58: State Farm “Experience” video, 2014
                                                                                            • Social Media

                                                                                                • Key points
                                                                                                  • Market overview
                                                                                                    • Key social media metrics
                                                                                                      • Figure 59: Key performance indicators, selected life insurance brands, Aug. 25, 2013-Aug. 24, 2014
                                                                                                    • Brand usage and awareness
                                                                                                      • Figure 60: Brand usage and awareness of life insurance brands, June 2014
                                                                                                    • Interaction with brands
                                                                                                      • Figure 61: Interaction with life insurance brands, June 2013
                                                                                                    • Leading online campaigns
                                                                                                      • Tackling consumer perceptions with social media
                                                                                                        • Hashtags to drive conversation
                                                                                                          • Sports partnerships
                                                                                                            • Social media for social good
                                                                                                              • What we think
                                                                                                                • Online conversations
                                                                                                                  • Figure 62: Online mentions, selected life insurance brands, Aug. 25, 2013-Aug. 24, 2014
                                                                                                                • Where are people talking about life insurance brands?
                                                                                                                  • Figure 63: Mentions, by page type, selected life insurance brands, Aug. 25, 2013-Aug. 24, 2014
                                                                                                                • What are people talking about online?
                                                                                                                  • Figure 64: Mentions, by topic of conversation, selected life insurance brands, Aug. 25, 2013-Aug. 24, 2014
                                                                                                              • Type of Life Insurance Owned

                                                                                                                • Key points
                                                                                                                  • Men more likely to have insurance than women
                                                                                                                    • Figure 65: Type of life insurance owned, by gender, June 2014
                                                                                                                  • Ownership of whole life increases with age
                                                                                                                    • Figure 66: Type of life insurance owned, by age, June 2014
                                                                                                                  • Income also is a driver
                                                                                                                    • Figure 67: Type of life insurance owned, by household income, June 2014
                                                                                                                  • More Hispanics have no life insurance
                                                                                                                    • Figure 68: Type of life insurance owned, by race/Hispanic origin, June 2014
                                                                                                                  • Singles don’t – But should – Have life insurance
                                                                                                                    • Figure 69: Type of life insurance owned, by marital/relationship status, June 2014
                                                                                                                  • Marriage more important than kids in life insurance decision
                                                                                                                    • Figure 70: Type of life insurance owned, by marital status and presence of children in household, June 2014
                                                                                                                • How Life Insurance is Purchased

                                                                                                                  • Key points
                                                                                                                    • Most purchase directly from insurer
                                                                                                                      • Figure 71: How policy(ies) were purchased, June 2014
                                                                                                                    • Purchased through own/partner’s employer
                                                                                                                      • Figure 72: How policy(ies) were purchased, by gender, June 2014
                                                                                                                    • Purchased directly from insurer
                                                                                                                      • Figure 73: How policy(ies) were purchased, by gender, June 2014
                                                                                                                  • Amount of Insurance Owned

                                                                                                                    • Key points
                                                                                                                      • Many people likely underinsured
                                                                                                                        • Figure 74: Amount of life insurance owned, June 2014
                                                                                                                      • Women need more insurance
                                                                                                                        • Figure 75: Amount of life insurance owned, by gender, June 2014
                                                                                                                      • Ownership changes at age 55
                                                                                                                        • Figure 76: Amount of life insurance owned, by age, June 2014
                                                                                                                      • Household income drives insurance ownership
                                                                                                                        • Figure 77: Amount of life insurance owned, by household income, June 2014
                                                                                                                      • Household income of $75K is sweet spot
                                                                                                                        • Figure 78: Amount of life insurance owned, by age and household income, June 2014
                                                                                                                      • Age of children has no effect on amount of life insurance owned
                                                                                                                        • Figure 79: Amount of life insurance owned, by parents with children in household, June 2014
                                                                                                                    • Life Insurance Providers

                                                                                                                      • Key points
                                                                                                                        • MetLife is the leader
                                                                                                                          • Figure 80: Life insurance provider, June 2014
                                                                                                                        • Provided by own or partner’s employer
                                                                                                                          • State Farm leads among young Millennials
                                                                                                                            • Figure 81: Life Insurance provider, provided by employer, by age, June 2014
                                                                                                                          • Many women not sure who provides their insurance
                                                                                                                            • Figure 82: Life insurance provider, provided by employer, by gender and age, June 2014
                                                                                                                          • MetLife is most popular among those with highest amounts of employer-provided insurance
                                                                                                                            • Figure 83: Life insurance provider, provided by employer, by amount of insurance owned, June 2014
                                                                                                                          • Purchased directly from insurer
                                                                                                                            • More competition when insurance is purchased directly
                                                                                                                              • Figure 84: Life insurance provider, purchased independently. by gender, June 2014
                                                                                                                            • State Farm most popular among younger consumers
                                                                                                                              • Figure 85: Life insurance provider, purchased independently, by age, June 2014
                                                                                                                            • MetLife is the leader among those with the most life insurance
                                                                                                                              • Figure 86: Life insurance provider, purchased independently, by amount of life insurance owned, June 2014
                                                                                                                          • Attitudes Toward Life Insurance and Insurance Companies

                                                                                                                            • Key points
                                                                                                                              • Most believe life insurance is necessary
                                                                                                                                  • Figure 87: Attitudes toward life insurance, by gender, June 2014
                                                                                                                                • Young people offer opportunity – And challenge
                                                                                                                                  • Figure 88: Attitudes toward life insurance, by age, June 2014
                                                                                                                                • Male Millennials are a challenge
                                                                                                                                  • Figure 89: Attitudes toward life insurance, by gender and age, June 2014
                                                                                                                                • Hispanics may be cross-sell opportunity
                                                                                                                                  • Figure 90: Attitudes toward life insurance, by race/Hispanic origin, June 2014
                                                                                                                                • Trust is an issue for married parents
                                                                                                                                  • Figure 91: Attitudes toward life insurance, by marital status and presence of children in household, June 2014
                                                                                                                              • Reasons for Purchasing Life Insurance

                                                                                                                                • Key points
                                                                                                                                  • Men have different reasons to purchase life insurance than do women
                                                                                                                                    • Figure 92: Reasons for purchasing life insurance, by gender, June 2014
                                                                                                                                  • Reasons for buying life insurance change with age
                                                                                                                                    • Figure 93: Reasons for purchasing life insurance, by age, June 2014
                                                                                                                                  • Higher household income increases use of life insurance as investment
                                                                                                                                    • Figure 94: Reasons for purchasing life insurance, by household income, June 2014
                                                                                                                                  • Race makes a difference in why life insurance is purchased
                                                                                                                                    • Figure 95: Reasons for purchasing life insurance, by race/Hispanic origin, June 2014
                                                                                                                                  • Married parents are “sweet spot”
                                                                                                                                    • Figure 96: Reasons for purchasing life insurance, by marital status and presence of children in household, June 2014
                                                                                                                                • Features of Interest

                                                                                                                                  • Key points
                                                                                                                                    • Mobile apps are not of much interest
                                                                                                                                      • Figure 97: Features of interest, by gender, June 2014
                                                                                                                                    • Personal contact with representatives is important
                                                                                                                                      • Figure 98: Features of interest, by age, June 2014
                                                                                                                                    • Interest in options is highest among married couples
                                                                                                                                      • Figure 99: Features of interest, by marital status and parents with children in household, June 2014
                                                                                                                                    • Young parents more interested in features
                                                                                                                                      • Figure 100: Features of interest, by parents with children in household, June 2014
                                                                                                                                    • Discounts may help increase incremental sales
                                                                                                                                      • Figure 101: Features of interest, by amount of life insurance owned, June 2014
                                                                                                                                  • Interest in Mobile Apps

                                                                                                                                    • Key points
                                                                                                                                      • Men have more interest in mobile apps
                                                                                                                                        • Figure 102: Interest in mobile app usage, by gender, June 2014
                                                                                                                                        • Figure 103: Interest in mobile app usage, by age, June 2014
                                                                                                                                      • More interest among those with higher household incomes
                                                                                                                                        • Figure 104: Interest in mobile app usage, by household income, June 2014
                                                                                                                                        • Figure 105: Interest in mobile app usage, by race/Hispanic origin, June 2014
                                                                                                                                      • Income defines interest among Millennials
                                                                                                                                        • Figure 106: Interest in mobile app usage, by age and household income, June 2014
                                                                                                                                      • Amount of insurance drives mobile app interest
                                                                                                                                        • Figure 107: Interest in mobile app usage, by amount of life insurance owned, June 2014
                                                                                                                                    • Appendix – Other Useful Consumer Tables

                                                                                                                                      • Life insurance ownership
                                                                                                                                        • Figure 108: Type of life insurance owned, by gender and age, June 2014
                                                                                                                                        • Figure 109: Type of life insurance owned, by age and household income, June 2014
                                                                                                                                      • How life insurance is purchased
                                                                                                                                        • Figure 110: How policy(ies) were purchased, by generation, June 2014
                                                                                                                                      • Amount of life insurance owned
                                                                                                                                        • Figure 111: Amount of life insurance owned, by gender and age, June 2014
                                                                                                                                        • Figure 112: Amount of life insurance owned – Nets, by gender, June 2014
                                                                                                                                        • Figure 113: Amount of life insurance owned – Nets, by age, June 2014
                                                                                                                                        • Figure 114: Amount of life insurance owned – Nets, by gender and age, June 2014
                                                                                                                                        • Figure 115: Amount of life insurance owned – Nets, by household income, June 2014
                                                                                                                                        • Figure 116: Amount of life insurance owned – Nets, by race/Hispanic origin, June 2014
                                                                                                                                        • Figure 117: Amount of life insurance owned – Nets, by marital status and presence of children in household, June 2014
                                                                                                                                        • Figure 118: Amount of life insurance owned – Nets, by parents with children in household, June 2014
                                                                                                                                      • Life insurance providers
                                                                                                                                        • Purchased through employer/partner’s employer
                                                                                                                                          • Figure 119: Life insurance provider, provided by employer, by gender, June 2014
                                                                                                                                          • Figure 120: Life insurance provider, provided by employer, by household income, June 2014
                                                                                                                                        • Purchased directly from insurer
                                                                                                                                          • Figure 121: Life insurance provider, purchased independently, by gender and age, June 2014
                                                                                                                                          • Figure 122: Life insurance provider, purchased independently, by household income, June 2014
                                                                                                                                        • Attitudes toward life insurance and life insurance companies
                                                                                                                                          • Figure 123: Attitudes toward life insurance, by household income, June 2014
                                                                                                                                          • Figure 124: Attitudes toward life insurance, by age and household income, June 2014
                                                                                                                                          • Figure 125: Attitudes toward life insurance, by parents with children in household, June 2014
                                                                                                                                          • Figure 126: Attitudes toward life insurance, by amount of life insurance owned, June 2014
                                                                                                                                          • Figure 127: Attitudes toward life insurance, by amount of life insurance owned, June 2014
                                                                                                                                        • Reasons to purchase life insurance
                                                                                                                                          • Figure 128: Reasons for purchasing life insurance, by age and household income, June 2014
                                                                                                                                          • Figure 129: Reasons for purchasing life insurance, by parents with children in household, June 2014
                                                                                                                                        • Features of interest
                                                                                                                                          • Figure 130: Features of interest, by household income, June 2014
                                                                                                                                          • Figure 131: Features of interest, by age and household income, June 2014
                                                                                                                                        • Interest in mobile apps
                                                                                                                                          • Figure 132: Interest in mobile app usage, by gender and age, June 2014
                                                                                                                                          • Figure 133: Interest in mobile app usage, by amount of life insurance owned, June 2014
                                                                                                                                      • Appendix – Social Media

                                                                                                                                          • Figure 134: Key social media indicators of selected life insurance brands, August 2014
                                                                                                                                          • Figure 135: Online mentions, selected car brands, Aug. 18, 2013-Aug. 17, 2014
                                                                                                                                        • Brand usage or awareness
                                                                                                                                          • Figure 136: Brand usage or awareness, June 2014
                                                                                                                                          • Figure 137: Northwestern Mutual usage or awareness, by demographics, June 2014
                                                                                                                                          • Figure 138: State Farm usage or awareness, by demographics, June 2014
                                                                                                                                          • Figure 139: Prudential usage or awareness, by demographics, June 2014
                                                                                                                                          • Figure 140: MetLife usage or awareness, by demographics, June 2014
                                                                                                                                          • Figure 141: AIG usage or awareness, by demographics, June 2014
                                                                                                                                          • Figure 142: New York Life usage or awareness, by demographics, June 2014
                                                                                                                                        • Activities done
                                                                                                                                          • Figure 143: Activities done, June 2014
                                                                                                                                          • Figure 144: Northwestern Mutual – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
                                                                                                                                          • Figure 145: State Farm – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
                                                                                                                                          • Figure 146: State Farm – Activities done – I have contacted/interacted with the brand online on social media to…, by demographics, June 2014
                                                                                                                                          • Figure 147: State Farm – Activities done – I have researched the brand on social media to…, by demographics, June 2014
                                                                                                                                          • Figure 148: Prudential – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
                                                                                                                                          • Figure 149: Prudential – Activities done – I have researched the brand on social media to…, by demographics, June 2014
                                                                                                                                          • Figure 150: MetLife – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
                                                                                                                                          • Figure 151: MetLife – Activities done – I have contacted/interacted with the brand online on social media to…, by demographics, June 2014
                                                                                                                                          • Figure 152: MetLife – Activities done – I have researched the brand on social media to…, by demographics, June 2014
                                                                                                                                          • Figure 153: New York Life – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
                                                                                                                                          • Figure 154: New York Life – Activities done – I have contacted/interacted with the brand online on social media to…, by demographics, June 2014
                                                                                                                                      • Appendix – Trade Associations

                                                                                                                                        Companies Covered

                                                                                                                                        • AIG Group (American International Group Inc)
                                                                                                                                        • American Association of Retired Persons (AARP)
                                                                                                                                        • John Hancock Financial Services, Inc
                                                                                                                                        • MassMutual (Massachusetts Mutual Life Insurance Company)
                                                                                                                                        • MetLife, Inc.
                                                                                                                                        • Mutual of Omaha Companies
                                                                                                                                        • New York Life Insurance Company
                                                                                                                                        • Northwestern Mutual Life Insurance Company (The)
                                                                                                                                        • Prudential Financial, Inc
                                                                                                                                        • State Farm Insurance Companies

                                                                                                                                        Life Insurance - US - September 2014

                                                                                                                                        £3,277.28 (Excl.Tax)