Consumers’ experiences buying life insurance direct.

This report was commissioned by the Australian Securities and Investments Commission (Asic). It describes consumers’ experiences buying life insurance ‘direct’, that is over the phone, online or in a branch without personal advice.

It covers:

• term life
• accidental death
• trauma
• total and permanent disability (TPD) and
• income protection insurance.

You can read the report that Asic produced here

Key insights:

The report identified the ‘journey’ that people took when considering and buying insurance direct. We identified three personas – or ways of buying this type of insurance:

1. The ‘Methodical’ persona represents a staged and ‘methodical’ or ‘logical’ approach to buying insurance. These buyers took time over the purchase, and used more than one channel to do so.
2. The ‘Pragmatic’ persona represents an approach to buying insurance that is ‘practical’ and relatively straightforward. Such buyers deliberately chose the easiest path to purchase to ‘get it over with’ and may have paid little attention to the details of their policy. Some chose simply on price.
3. The ’Emotional’ persona represents a buyer for whom the actual experience of buying insurance was emotional, partly because of the emotional appeals made to them during the sales process. The purchase was not just a practical matter of covering the mortgage repayments (for example) it was more of an emotional desire to ‘leave something for the kids’. Some also bought because they ‘couldn’t say no’. These buyers generally bought in a single step and were responding to an outbound call or advertising or other promotion or incentives.

This report was cited in several submissions to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

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