Americans want ease and speed when buying life insurance so they are opting to go the route of simplified underwriting, according to the 2019 Insurance Barometer Study conducted by LIMRA and Life Happens.

And because ownership numbers are declining, many insurance companies have leveraged advances in technology—such as advanced analytics, big data and artificial intelligence—to streamline the underwriting process and better meet the needs and preferences of today’s consumers, the study found. 

Since the inception of the study in 2011, life insurance ownership has declined from 63 percent to 57 percent in 2019.

James Scanlon, senior research director of LIMRA Market Research, said two-thirds of Americans recognize they need life insurance yet many do not have adequate coverage to protect their families.

“As the industry continues to find innovative ways to improve the speed, ease and transparency of the life insurance purchasing process, we hope it will encourage these individuals to purchase the coverage they need to protect their families,” he said.

Nearly two thirds (63 percent) of those who are interested in purchasing life insurance through simplified underwriting are drawn to the speed and ease that it offers, the study found. Other appealing benefits include risk and price transparency (57 percent), unbiased and objective application process (57 percent), and that it eliminates the need to see a doctor or take medical exam (56 percent).

The study found that life insurance products that combine other benefits, such as long-term care provisions, continue to grow. A majority of Americans (53 percent) are likely to purchase a combination life insurance product, and one in five (roughly 42 million Americans) say they are “very” or “extremely” likely to buy a combination product.

The top reason people say they would buy a combination life product is to lower the possibility that long-term care expenses would deplete their savings (36 percent). One in three consumers are attracted to the flexibility and value of the product, allowing them to address multiple financial risks simultaneously and saving the expenses associated with separate policies, the study noted.

In addition, the study tested consumers’ knowledge about different insurance products, along with their perceived need of these products and whether they own them. Overall, it found that consumers are most likely to say they are knowledgeable about life insurance (46 percent). Knowledge levels significantly dropped for disability insurance (38 percent), long-term care insurance (35 percent) and annuities (35 percent).

The Insurance Barometer is an annual study that tracks the perceptions, attitudes and behaviors of adult consumers in the United States. In January 2019, LIMRA and Life Happens engaged an online panel to survey adult consumers who are financial decision makers in their households. The survey generated more than 2,000 responses.