Affluent Clients Fret More And Do Less About Life Insurance, Hartford Finds

? 43% said they did not fully understand their life insurance policies, up slightly from 41% last year. They cited unclear language, the use of technical terms and complexity as the main reasons for the confusion.

? 51% said the recent bear market did not alter their personal investment strategy. On the other hand, 25% said they now invest more conservatively vs. 11% who are more aggressive.

One of the main conclusions of the survey for agents and for the industry in general is that higher-income people want simpler, easier to understand life insurance policies, Kalen says.

Hartford has seen a big surge in life insurance applications since it began marketing a short version of its policy application three years ago, he says. The number of applications rose from 10,745 in 2002 to 13,099 in 2003, a 22% increase. The upsurge continued into the first quarter of this year, rising 53% to 4,165 applications, from 2,725 in the first quarter of 2003, Kalen reports.

"More people are thinking about life insurance, but a lot feel the process is confusing," he says. "Representatives and insurance companies have to make the process easier and more understandable."

Another lesson from the survey is that financial advisors need to press affluent clients to evaluate their insurance needs frequently, Kalen suggests.

"They should be sitting down at least once a year to review coverage in the context of their overall financial plan," he says.

Reproduced from National Underwriter Edition, June 25, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.