- Association helps life insurance industry serve more Americans -
Direct response selling of life insurance is the fastest growing segment of the life insurance industry today. Each year a higher percentage of overall life insurance sales can be attributed to some type of direct marketing effort.
More than $300 million in life insurance premium is initiated each year from direct response efforts and direct sales of life insurance represents as much as 10% of all policy sales on an annual basis.
According to Pat Wedeking, chairman of the Life Insurance Direct Marketing Association (LIDMA), what was once considered a “non-traditional” form of life insurance sales is now becoming a major source of new business.
“Our industry has embraced a shift in customer behavior and preference in how they want to address their life insurance needs. Some want to feel more ‘in control’ of their insurance decisions, many want to save their time and others simply want their insurance protection in force in a more timely fashion.”
LIDMA was formed as a catalyst for the growth for life insurance professionals involved in direct marketing and those looking to expand their new business efforts into direct response sales. The organization will serve as a source for industry research and will monitor the interest of its members on a legislative level. The Association also serves as the industry’s primary forum for the exchange of ideas, a champion for the development of advanced marketing and operations technology and an advocate for industry ethics and professional standards.
Since its inception as a not-for-profit organization in 2005, LIDMA has grown quickly and its membership now includes many of the life insurance industry’s top carriers, agencies, producers, exam companies and technology vendors.
“We have made tremendous strides in bringing together the major players in the life insurance direct response industry and together we have already made some real progress,” said Shervin Eftekhari, vice president of LIDMA. “LIDMA’s ultimate objective is to help get more life insurance in force more efficiently. The support that LIDMA has received in these early days shows there are many in our industry that see the same opportunity we do regarding the growth of this sales segment.”
The growth of the direct sales niche can largely be attributed to a void direct marketers are filling, especially with middle income earners. Statistics from the American Council of Life Insurance 2004 Fact Book reported 12,581,000 individual permanent and term life polices were purchased, virtually the identical number purchased almost 30 years before. Over the same time period there was a 38% increase in the U.S population base of 293.7 million in 2004, as compared to 212.6 million in 1975 – yet the number of policies sold remained consistent.
According to LIMRA, the Life Insurance Market Research Association, in 2004, one-third of adults in the U.S. carry no life insurance at all. Although there has been an increase in group insurance with ownership rising from 25% in 1976 to 37% in 2004, there is still a large and growing segment of the population which is not being served and life insurance direct marketers are ideally positioned to occupy this niche.
“The direct response industry has adapted to a continued change in customer behavior towards more remote, direct buying,” says Wedeking. “While there continues to be strong demand for traditional face to face advice for consumers, the growth of direct response sales in our industry shows that there is an incredible opportunity for the life insurance industry to serve the otherwise underserved middle market.”
Some of LIDMA’s early successes involve working with carriers to incorporate new processes and operations enhancements to better service the volume of direct sales policies. The Association also serves as a consolidated voice to technology companies that have improved customer interaction and policy processing through the Internet and those that look to upgrade the customer service levels in nationwide call centers.
LIDMA is also becoming active in nationwide marketing campaigns to educate consumers on their need for life insurance and the direct response avenues available to them to address their specific life insurance objectives.
While LIDMA’s goal is to support and enhance the success of its members, the Association never looses sight of its true mission.
“As life insurance professionals we can never loose sight of the fact that our products are a vital part of the security of the consumers we serve around the world,” says Wedeking. “We want to help our members get more policies in force because we know that by doing so we are helping to protect more individuals and families.”
LIDMA’s offices are located at 3227 S. Cherokee Lane, Suite 1320 in Woodstock, GA.
For more information on LIDMA, visit our site
or call 866-890-LEAD (5323).