Life Insurers Face Consumer Confusion and Disengagement — Capgemini SE

Event summary

42% of consumers are confused or unconvinced by life insurance policies, with 25% abandoning the purchase journey.
Nearly 40% of policyholders rarely hear from their insurer after purchase, and half discontinue coverage within three years.
Best-in-class insurers achieve 41% higher revenue growth and 12% lower lapse rates by focusing on consumer-led strategies.
51% of consumers plan to use generative AI tools to research and compare life insurance products.
Only 18% of insurers have a unified strategy and customer journey roadmap.

The big picture

The life insurance industry is grappling with a relevance crisis, as consumers struggle to see the value of policies amid technical language, affordability concerns, and post-purchase disengagement. Best-in-class insurers are setting a new standard by leveraging AI, human advisors, and data-driven strategies to build lasting customer relationships. The report highlights a significant opportunity for insurers to educate consumers and transform the purchase journey to drive long-term growth.

What we're watching

Consumer Expectations: How insurers will adapt to rising consumer expectations for personalized, stage-relevant advice and ongoing engagement.
AI Integration: The pace at which insurers integrate generative AI tools while maintaining human advisor involvement.
Best-in-Class Differentiation: Whether mainstream insurers can replicate the success of top performers in revenue growth and lapse rate reduction.