The U.S. insurance industry sold over $149 billion in premiums in 2009, according to the Insurance Information Institute. Despite the size of the industry, insurance marketers have difficulty promoting insurance products to the marketplace, for several reasons.
Customer Apathy
Few people enjoy researching or purchasing insurance. The product is dry and replete with legal jargon that makes it all but impossible to understand. Many consumers shop at the time of a major life change, such as the purchase of a new home or auto. Once they choose an insurer, most will simply stay with the company because it is the easiest thing to do.
Price Focus
Those individuals who voluntarily shop for a new insurer generally do so to find a cheaper price. A 2010 study undertaken by J.D. Power and Associates points out that 41 percent of people who switched insurers did so because of price. Equally as telling, 76 percent of people who received a quote from a company but did not purchase a policy from that insurer said they were influenced by price. When price is your main motivator, it is difficult to market anything else.
Common Products
Marketers also face challenges because insurance products from all insurers are essentially the same. Insurance companies stick to standard policy wordings when possible, because the language in the contracts has been proven in court. In many territories, auto insurance policy language is mandated by law, with insurers forced to use a standard policy. This leaves very little for insurance marketers to market.
Tags: insurance marketers, insurance products, percent people, standard policy