The time-honored value of life insurance has been amplified during the COVID-19 pandemic.
Life insurance is the cornerstone of financial security for millions of American families and businesses. It enables Americans to maintain independence in the face of financial catastrophe, regardless of where and how they work, their economic status, race, gender, or stage of life.
But only 52 percent of Americans have life insurance coverage, down from 63 percent just a decade ago.
To help reverse this trend, the life insurance industry wants to make it easier for American consumers to get the information they need to make informed decisions about buying life insurance.
A working group of the National Association of Insurance Commissioners (NAIC) has the goal to “develop an online resource on life insurance, including the evaluation of existing content on the NAIC website, to be published digitally for the benefit of the public.” Life insurers wholeheartedly support this goal.
The NAIC website currently only includes a static PDF version of a “Life Insurance Buyers Guide” from 2018. Life insurers believe that this Buyers Guide should become the introduction to an updated modern online guide with hyperlinks to key insurance terms, concepts and educational content including frequently asked questions.
A user-friendly online guide is ideal for today’s computer-savvy consumers. In 2019, 90 percent of U.S. adults used the Internet. Among adults 18-29 years old, the usage was 100 percent.
The NAIC’s model guidance for state insurance departments requires life insurers to provide to purchasers of life insurance key information that will help to improve their ability to select the most appropriate life insurance for their needs. In recent years, life insurers and insurance agents have been working to provide more materials to consumers via the Internet. This momentum has accelerated since COVID-19, as safety restrictions have expanded the use of electronic signatures, electronic delivery, and online notarization of documents.
An enhanced online Life Insurance Buyers Guide would be a natural extension of this trend. It would help more Americans achieve the financial security they and their families deserve.
Michael Lovendusky was Vice President & Senior Associate General Counsel at the American Council of Life Insurers (ACLI). He represented ACLI on life insurance illustration and consumer disclosure issues before the National Association of Insurance Commissioners.
