Two recent studies by J.D. Power, one on individual life insurance and the other on individual annuities, found that overall, customer satisfaction with each of these products is improving. This is a big turnaround from recent years in which customer satisfaction and engagement decreased the longer an individual held a policy.
So what changed? Digital interaction. The studies showed that more customers use digital tools to monitor policy updates and changes and communicate with local agents and financial advisers. Nearly three-fourths, or 72%, of annuity customers regularly interact with their provider digitally via website, email, chat, text or mobile app.
Other key findings include:
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
- The number of life insurance customers purchasing their policies for financial and final planning reasons increased to 39% in 2023 from 30% in 2022.
- Customer satisfaction with annuity products is 800 (on a 1,000-point scale) this year, a significant 11-point increase from 2022, largely driven by increased digital engagement.
- State Farm ranks highest among individual life insurance providers for a fourth consecutive year, with a score of 843. Nationwide (840) ranks second and MassMutual (809) ranks third.
- F&G (formerly Fidelity & Guaranty Life) ranks highest among individual annuity providers, scoring 843. MassMutual (827) ranks second and Nationwide (826) ranks third.
"Sales of life insurance enjoyed a brief surge in popularity during the height of the pandemic, while sales of annuities have more recently soared,” said Breanne Armstrong, director of insurance intelligence at J.D. Power. “Now, with more customers than ever engaging with life insurance and annuity providers more frequently via digital channels, we’re starting to see a real evolution.”
Should you buy life insurance when you're young?
It’s safe to say, one of the last things on your mind is buying life insurance when you’re young and healthy, But if you’re between the ages of 20 and 40, now could actually be the best time to invest in your future.
Besides, there is usually less chance of being turned down for a life insurance policy when you’re young, and policies are typically more affordable than when you’re older. In fact, the monthly payment on a 30-year term life insurance policy may cost less than a few Uber rides or dinner at your favorite restaurant, and the protection means one less thing your family needs to worry about.
In much the same way, a retirement plan such as an annuity can provide reliable income when you need it and can often bridge the gap between your accumulated savings and Social Security or other sources of retirement income. Plus, annuities grow tax-deferred, which means Interest earned in a deferred annuity is not taxed until withdrawn.
About the findings
J.D. Power's 2023 U.S. Individual Life Insurance Study measured overall customer satisfaction with the largest individual life insurance companies in the U.S. The study is based on responses from 5,588 individual life insurance customers. The U.S. Individual Annuity Study measured overall customer satisfaction with the largest annuity companies in the U. S. from 3,579 individual annuity customers. Each study was conducted between May and July 2023.
Related Content
-
Do You Really Need That Wine Cellar?Home Features Wine cellars are a popular feature in high-end houses. Will installing one in your home increase its value, or would you be better off with a cheaper solution?
-
Think a Repeal of the Estate Tax Wouldn't Affect You? WrongThe wording of any law that repeals or otherwise changes the federal estate tax could have an impact on all of us. Here's what you need to know, courtesy of an estate planning and tax attorney.
-
What Pet Insurance Does and Doesn’t CoverPet insurance can save you thousands on vet bills, but it doesn’t cover everything. Here are the key types of coverage and exclusions you need to know.
-
Hail Damage Insurance Claims: Is Filing Worth the Cost and Hassle?Before filing a hail damage insurance claim, understand the potential costs, risks and whether it’s worth the effort. Learn when to file and when to pay out of pocket.
-
Five Smart Ways to Use Your Life Insurance While You're Still AliveLife insurance can do more than just provide for your heirs — here’s how to maximize your policy while you’re still here.
-
Five Water Damage Risks Homeowners Forget About — and Why Insurance Won’t Always Cover ThemWater damage is one of the most common — and costly — home repairs. Here's what your policy may not protect against, and how you can avoid major headaches.
-
What Does Travel Insurance Cover? 6 Types of Coverage for Your Next TripFind out what travel insurance covers and whether or not you need it on your next vacation.
-
Denied and Abandoned: The Rise of Unregulated Insurers and the Homeowners Left BehindAs traditional insurers retreat from California's high-risk zones, a surge of unregulated carriers steps in, leaving a trail of denied claims and devastated homeowners.
-
Why You Should Pay Your Traffic Tickets Before They Become a Six-Figure HeadacheSkip a ticket, pay a fortune: How ignoring traffic fines can wreck your wallet, credit and coverage.
-
What Is Term Life Insurance?Term life insurance offers affordable coverage for a set period — here’s how it works and when it makes sense to buy a policy.
