BOSTON— Robert A. Kerzner, CLU, ChFC, president and CEO of LIMRA, LOMA and LL Global, opened the 99th LIMRA Annual Conference in Boston on Oct. 25, examining the potential disruption facing the financial services industry and how companies can respond and thrive in this new world order.
“Technology can be a disruptor or an enabler ─ websites like Google Compare and Policy Genius make price the top driver for consumers,” said Kerzner (shown at right). “For some companies these sites represent an unwelcome disruption while others are leveraging these sites to enter new markets and reach new customers.”
Kerzner highlighted the impact commoditization can have on an industry and noted that to avoid it, companies need to differentiate themselves through innovation, service or segmentation. Citing examples like John Hancock’s partnership with Vitality, Mass Mutual’s Society of Grownups and Protective’s relationship with Costco, Kerzner pointed to the importance of building long-term, ongoing relationships with consumers.
“The rise of the consumer is having a tremendous impact on every industry,” stated Kerzner. “Consumers have more choices and more power to determine how and when they access information. We need find ways to be where they are in their day-to-day lives.”
According to LIMRA research, 41% of people shop for life insurance as a result of life events, like getting married, buying home or having a child. Kerzner suggested insurers find ways to connect with consumers during these life events. He speculated that companies could engage new parents at the hospital through kiosks, educating them about the importance of life insurance to ensure their family’s financial security.
Kerzner also discussed the growing robo-advice market and how it will impact today’s advisors. “Will producers be disintermediated? No, our research demonstrates that people still want advice from a person,” he said. “But the model will change and advisors will need to leverage more of the tools and technology available to meet consumers’ expectations. Companies too will have to shift their strategies, building platforms and relationships that attract consumers to seek the advice in new ways.”
Kerzner ended his remarks discussing the most imminent disruptor of the financial services industry: the Department of Labor’s proposed fiduciary rule. He pointed to LIMRA Secure Retirement Institute research that illustrates the positive impact using an advisor has on retirement savings rates and retirement planning.
“In the next 10-20 years, there will be an unprecedented shift of assets as the majority of Boomers enter retirement. It is likely their financial goals also will shift from accumulation to principal protection and income generation. They will need help to achieve those goals,” noted Kerzner. “Our research indicates that people are more likely to save and plan for retirement when they work with an advisor. It seems clear that this is just the beginning of an effort to limit how we can serve people who are trying to get the financial advice they want and need.”
The LIMRA 2015 Annual Conference’s theme, “Pivot Point: Striking a Path for Success,” focuses on the challenges and changes affecting the financial services industry. The conference brings together leading experts and company executives to examine today’s most important issues, and to revisit, and possibly rethink, the ideas that have informed the industry's strategies and tactics to date.
More than 500 senior leaders from life insurance and financial services companies worldwide attended the industry's most prestigious meeting.
Next page: Execs share candid insights in Monday panel session
- Millennials' love/hate relationship with insurance
- Glad you asked: The 5 most important things to know about life insurance
- "Do-It-Yourselfers" not as capable as they think at managing finances
- Carriers using simplified issue to tap into uninsured market
- May's Disability Insurance Awareness Month campaigns focus on younger working adults; small business owners
- 5 reasons to immediately ramp up your efforts to recruit female advisors
- Med Supp market sees 6% growth in 2016 according to new data
- Consumers want simple, transparent life insurance buying options: 2017 Insurance Barometer Study