Life insurance companies are adjusting their marketing strategies to attract more consumers to purchasing a policy, according to the results of a recently released survey. Strategy Meets Action, in partnership with LOMA, released the results of a survey of insurers in North America that revealed life and annuity companies are increasing their information technology investments by an average of 2 percent in 2013.
"Life and annuity companies continue to invest in technology to enhance the customer acquisition process," said Mark Breading, SMA partner. "Distribution is the number one area where technology budgets are increasing, with marketing and new business/underwriting not far behind."
The results of this year's study were a sign that the industry has made changes in priorities from the results of the same study conducted in 2011. In 2011, business optimization was the top priority for most life insurance companies, but IT investments have moved up on the list.
"Our members clearly understand the strategic value of IT," said Jeff Hasty, FLMI, senior vice president of LOMA. "Priorities and investment directions shift as challenges and opportunities unfold. The key is to develop the flexibility to stay competitive and meet today's changing market demands."
Life insurance helping with college expenses
As Americans prepare to send their kids off to college, many are concerned with the cost they will incur while their child is being billed for tuition and room and board. According to Investment News, financial advisors are turning more parents to life insurance to fill the void.
The source reported that life insurance that has a cash balance can be utilized to pay for higher education has tax advantages as opposed to the popular 529 college savings plans.
Twenty-nine percent of financial advisers reported that they suggested for their clients to use life insurance products last year to save for college, which is a figure that has increased significantly from previous years. In 2011, 23 percent of financial advisors recommended that clients use life insurance products to save for college and 21 percent in 2009, according to the results of a survey released by Financial Research Corporation.
As life insurance companies look to make improvements to their companies to increase the number of policyholders, Americans should make sure they are building their basic savings accounts to make sure they can afford to send their kids to college just in case they can't use a life insurance plan.