Both Life Insurance and Annuity Customer Satisfaction Decline as Pandemic Fears Wane

Individual life insurance and annuity products—with the longest term lengths of long-term investment and insurance products—have created a customer engagement problem. According to the J.D. Power 2022 U.S. Individual Life Insurance Study^SM and the J.D. Power 2022 U.S. Individual Annuity Study,^SM both released today, customer satisfaction with these products starts declining relatively soon after they are purchased, resulting not only in low likelihood of consideration to purchase other insurance and financial services products but also a general lack of understanding of the products these customers already own.

While the industry declines, it is notable that award winners in both studies, State Farm and American Equity Investment Life Insurance, buck the trend and exhibit some of the largest year-over-year increases in customer satisfaction.

“After a brief surge during the height of the pandemic, overall customer satisfaction with individual life insurance and annuity plans have now reverted to their previous long-term trends in which customer satisfaction declines as tenure with the product increases,” said Robert M. Lajdziak, director, global insurance intelligence at J.D. Power. “It’s clear from our data that insurers are struggling to maintain regular contact with customers and to reinforce a unique value proposition during the length of the relationship. That not only limits potential future sales opportunities, but also exposes incumbents to competitive threat from insurtech start-ups that are leveraging digital to deliver a more multi-channel approach to client engagement that is resonating with customers.”

Click here to read the press release, including full rankings and additional key findings from the 2022 studies.