New Survey Shows Term Sales Are Changing: Three Key Takeaways

Nikki Parker | June 2024 | 4-minute read

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We know the “right” answer. Our brain tells us what we should prioritize. And yet, half the time, we don’t listen.

It’s that way with many things in life. Choosing a healthy meal instead of fast food. Doing the dishes instead of binging another episode of your favorite show. And even, challenging your existing assumptions when buying term life insurance.

In partnership with Legal & General America (LGA), we recently surveyed advisors about what they look for when selling term. The survey revealed some key data about how advisors make product recommendations.

Below are three key takeaways that anyone selling term should know.

1. The Price vs. Speed Factor

The audience was split.

Of the seven options, 40% of respondents chose price as the most important factor when recommending a term product to a client. However, cycle time and insurance company financial strength were close contenders.

Later in the survey, only 10% of respondents said they would choose a product based on the most affordable option. Instead, having a solution that was priced within the top three choices was the consensus.

The results make it clear that advisors are recommending based on a combination of price, cycle time and carrier reputation.

We take all of these into account when quoting with Ash Express. Using the Ash Rating, you can quickly tell how likely a client is to get approved, while still factoring in value and approval time.

To see the expanded underwriting information, just click the expand and collapse arrow on the right-hand side. The drop-down will give you information to make an informed decision based on underwriting outcomes from similar cases.

Sometimes, the most affordable option is best. But many times, a better client experience is only a few dollars difference. It’s why we believe you should quote based on outcome, not price.

2. Setting Proper Expectations

Time is always a key factor. The longer clients wait for a product, the less likely they are to buy.

One respondent commented, “I would sell more term if we could improve the turnaround.”

Other advisors agree, with 77% saying application cycle time was “very” or “extremely” important. Cycle time was defined as submission to application approval, for a fully underwritten term case.

However, when evaluating cycle time, there was not a consistent response for what constituted ‘optimal’ cycle time. The answers reinforced the importance of setting proper expectations with your client, and with your Ash case manager.

Even “instant” products can vary dramatically in the time between an underwriting decision and issue.

Some advisors indicated they weren’t sure a client would qualify for instant decision, therefore they’d rather go traditional to set expectations with clients from the start. They expressed not wanting clients to “get their hopes up” before being kicked to additional underwriting.

But what if they could qualify? How would these clients feel if they completed labs and exams that were not fully necessary? It’s fine to use a slower benchmark to set an expectation — but why not try to exceed it by starting with an instant decision product? No client has ever complained that they got their insurance approval too fast.

3. Keeping Up with Product Innovation

Insurance companies are always changing product names. Even if you have go-to solutions, make sure to look at the other options before moving forward.

Taking Legal & General America as an example, OpTerm has been around for years, while FlashTerm is less than a year old. Both are strong term life insurance products, and the price difference between the two products could be as little as $6. However, OpTerm takes 14 days to reach an average underwriting decision while FlashTerm takes five.

True, not every client will qualify for instant issue or accelerated underwriting. But the key is awareness. One survey respondent wasn’t familiar with FlashTerm and stated they “have some prospective clients for which this product would be perfect.” Another stated, “I wasn't aware of these options. This is a very good price.” It shouldn’t take an industry survey to get your clients the best solution.

Before you quote a product, look into the products you aren’t familiar with — or see what’s changed on products you know.

Is there a faster option? A better approval rate? Are there certain products that fit your client’s health profile better? Challenge your assumptions as the industry evolves.

The days of selecting “Preferred Best” and selling whatever comes up as the lowest cost are gone. To successfully get your clients the best coverage, take the time to do a full pre-underwriting screening, like the questions in Ash Express. It will help streamline the process and lead to a better client experience.

Insurance is Dynamic

Price is only one factor of a good term insurance policy. It’s an important part of the sale, but the most important thing is to make sure your client has the right coverage. The next time you present a quote to a client, emphasize outcome over price.

By taking the time to clarify expectations, ask questions and review the available solutions, you’ll be sure to get the best of speed, cost and quality of coverage.

Survey Design

The survey was open to anyone who has sold three or more term insurance policies through Ash Brokerage since January 2023. 245 advisors chose to participate.

These are advisors who know how to sell term.