Agent-sold insurance, which has dropped from virtual monopoly 20 years ago to 82% currently, is expected to continue to diminish to 68% in five years, according to Hartford, CT-based Conning & Co.
According to the company’s report, “Life Insurers’ Distribution Strategies Testing the Waters,” insurers are testing a number of channels less expensive than the traditional agent-sold medium. Financial planners, stockbrokers and banks will sell 20% of all life insurance policies, followed by direct marketing (6%), quote services and Internet sales and leads (4%), and workplace marketing (2%).
The channel variations are even greater when the target markets are considered. So-called “middle-market” consumers are anticipated to be increasingly targeted by direct marketing, with this method accounting for up to 12% of all efforts. Among the most upscale market, financial planner and stockbroker-sold policies will amount to about 25% of market sales within the same time period.
