When the Customer Is Wrong (about Life Insurance)

A new sense of mortality—and urgency

The untimely death of a loved one once seemed like a remote possibility. But the pandemic has brought a new awareness of how vulnerable life can be. Numbers from LIMRA tell the story:

• Nearly one-third of consumers surveyed (31%) say COVID-19 has made them more likely to purchase life insurance within the next 12 months
• They’re 50% more likely to buy when simplified underwriting, like the Ethos 100% online process, is available.
  
  

Type “funerals” into the search field at GoFundMe and scroll the endless tales of the unexpected loss of a loved one, compounded by an acute financial crisis. The truth is, life can be breathtakingly uncertain. But the financial impact of a loss can be avoided with life insurance. 

Bottom line: Millions of Americans lack critical life insurance. But today, getting coverage is simple with Ethos. That means when you share Ethos with your customers, it’s a great opportunity to help move them from inaction to protection.

Talking Points

You’ll hear lots of reasons why customers put off buying life insurance. Here are five of the most common, with tips on how you can respond:

1. They believe they can’t afford it. LIMRA research finds people wildly overestimate the cost of term life insurance. Millennials especially overestimate by 5-10x! In fact, a healthy 35-year-old non-smoker can buy a 10-year, $1,000,000 term life policy for about $65 per month at Ethos. That’s less than the cost of many auto and home insurance policies. And of the three — car, house or family — which is more important?
   
   
2. They think they have sufficient life insurance coverage through work. Workplace coverage is typically 1x salary. That’s not enough to help a grieving family maintain their way of life and fund long-term goals like college tuition. Also, if you leave a job, you can’t always take your life insurance with you.
   
   
3. They don’t want to think about it. An Ethos application takes about 10 minutes. So if your client can bear to think about life insurance for a fraction of an hour, they can probably get the protection their family needs. And there’s no time like the present.

• The longer they wait, the more expensive life insurance gets. Healthy, younger adults can get the most coverage: up to $2M in term through Ethos.
• Circumstances can change and future insurability is not a given. Once your client gets coverage, they’ll never lose it due to health changes.

4. They believe they don’t need it. Some people believe they’ve got sufficient assets to protect their family. In other words, they plan to “self-insure.” It sounds good – but it may be unrealistic. Consider:

• 42% of Americans would face financial hardship within six months if the primary wage-earner were to die unexpectedly, according to LIMRA.
• A middle-class child born in 2015 will cost nearly $300,000 to raise to adulthood. That’s not counting the cost of college, currently about $80,000 per year for an Ivy League education.
• Your clients can purchase much more coverage than they can provide on their own, for an affordable rate. 
• Even people with significant assets can find they’re grateful to have the additional living benefits a life insurance policy can offer. For example, a standard terminal illness rider allows policyholders to access a portion of their policy’s death benefit if they become terminally ill.

5. Finally, a major reason people don’t get life insurance is they think the process is too complicated and time-consuming. This used to be the case. Applicants typically had to arrange for a paramedical exam in their home, then wait weeks or months for approval from a carrier. But the Ethos process is built for the way consumers want to do business, with no need for blood draws or other intrusive tests. Our technology enables us to approve 95% of customers ages 18-85 in as little as 10 minutes — with just a few health and lifestyle questions.

Next steps

Make sure your client’s family never has to turn to an online fundraiser if the unthinkable happens. In the Ethos agent portal, you’ll find everything you need to help your clients get life insurance protection:

• Licensed life insurance agents can generate a quote in the Ethos agent portal with just a few pieces of customer info, and send it to them. Your customer can start the online application from there, and you’ll receive compensation for every activated policy.
  
  
• If you don’t have a life insurance license, you can send your customers a unique URL to apply on their own. This URL serves as your referral code – when they buy an Ethos policy, you get a referral fee. You can track your client’s progress and your earnings in the agent portal.
  
  
• Find life insurance information to share with your customers in the Resources section of the agent portal. Or, send them to our Help Center for general information on life insurance. 

Just getting started with Ethos? Find the support you need to scale your business in our resources section