Helping Consumers Fill Gaps in Life Insurance Coverage Through Digital Agreements

September is Life Insurance Awareness Month, and there’s no better time to consider why life insurance is a critical yet underappreciated line of coverage.

The need for the security that life insurance provides was presented in stark relief during the pandemic, as millions were laid off or furloughed during the early months of COVID-19. Many workers became aware for the first time of the limitations of employer group life insurance and began researching other options to supplement this coverage.

According to LIMRA research, 31 percent of Americans are more likely to buy life insurance because of COVID-19. This figure rises across many demographics, including Millennials (44%), Black Americans (38%) and Hispanics (37%). 

Yet significant gaps in coverage remain. Overall, 41 percent of Americans say they don’t have sufficient life insurance coverage, and the shortfall is even higher among some underserved groups, including women (44%), Asian Americans (45%), Millennials (47%) and Black Americans (48%). Half of all LGBTQ+ Americans say they need more coverage than they currently have.

Why is this important? Because 4 in 10 families say they would face financial hardship within six months if the primary wage earner died. For 1 in 5, such hardship would arrive within just one month.

Policyholders should review their coverage annually

For those consumers that believe they do have adequate coverage presently, experts recommend reviewing coverages at least on an annual basis. This is particularly important for policyholders experiencing a life-changing event, such as a change in address, the birth of a child or a change in marital status. Each month, approximately 5 percent of policyholders experience such a life change and are anywhere from 2 to 14 percent more likely to purchase a life product during these times.

Unfortunately, friction during various stages of the insurance buying journey is a significant barrier to consumer adoption of life insurance, preventing millions from obtaining the right amount of coverage for their needs, or any coverage at all. According to a 2021 LIMRA survey, 48 percent of all respondents (including 42% of uninsured consumers) said they would be more likely to purchase life insurance if simplified underwriting was available.

Where digital insurance agreements can help

Insurance carriers and agencies are adapting to consumers’ evolving needs to compete effectively, deliver a better customer experience, improve efficiencies and minimize risk.

Digital insurance agreements from DocuSign can help insurance firms streamline application processes and remove friction from the purchasing process for policyholders, agents and carriers alike. This will help increase enrollment and enable more consumers to obtain the critical coverage they need to protect their families from unforeseen events.

Carriers and agencies use DocuSign to empower their teams and agents to deliver more value with less paperwork by simplifying complex life insurance forms with tools for better application completion. With DocuSign, you can:

  • Enable customers to securely sign and notarize agreements from virtually anywhere, on almost any device, through a mobile-friendly experience. 
  • Reach policyholders faster with SMS notifications and empower customers to complete agreements in real time with a live insurance agent through DocuSign eSignature for Zoom.
  • Accelerate agreement turnaround with easy-to-complete Guided Forms, which offer adaptive intake that can be completed quickly and easily and then immediately signed electronically.
  • Streamline processes with advanced workflows and pre-built connections to policy administration systems.
  • Support compliance and improve security with digital audit trails, authentication and identity verification tools.

With an estimated 106 million Americans living with a gap in life insurance, there’s no better time than Life Insurance Awareness Month to spread the word about this important—and often overlooked—area of coverage. With the support of digital agreements that streamline application and underwriting processes and improve customer experience, it’s now even easier for life insurance to be a part of every family’s sound financial plan.

Want to learn more about how your insurance company can achieve a streamlined agreement process? Contact us today to start your journey with DocuSign.

Kelli Mulligan
Insurance and Financial Services Solutions Director