A new study by Forbes Advisor, the financial guidance and price comparison platform, shows that nearly one in 10 people who currently hold a private, non-workplace life insurance policy chose theirs after hearing the topic discussed by a social media influencer.
Perhaps unsurprisingly, being influenced by a social media personality was more popular among a younger audience. Over one in six (16%) of 18-24 year-olds that currently hold a policy privately stated that they came to hear about their policy from an influencer on some type of social media. A similar number of 25-34 year-olds came to choose their policy the same way (17%).
While social media influencers might be a novel avenue when it comes to choosing any type of financial product, most people obtained their life insurance through more conventional means. According to Forbes Advisor’s study, the most common way people heard about their current policy or policies was through a finance professional such as an insurance broker, which was the case for over a third (36%) of the public.
The second and third most common ways people took out a life insurance policy were through a recommendation from a friend or member of their family (28%), and comparison sites like Forbes Advisor (25%).
While some people enjoy life insurance as an employee benefit – known as ‘Death in Service’ cover – most people access it outside of their work contract, with over four in five (84%) taking out their policy privately. Over a quarter (27%) said they accessed a policy through their workplace, suggesting some respondents have more than one active policy at a time.
Death in Service cover is usually limited to four times annual salary, which may be less financial protection than is required, hence the need to make additional private provision.
When asked the specific reason why they took out their policy, almost two in five (38%) answered that, while they do not expect anything specific to happen to them, they are being cautious. Three in 10 (30%) decided to take out a life insurance policy once they became parents, and just over one in five (21%) had life insurance as a requirement for their mortgage.
Kevin Pratt, life insurance expert at Forbes Advisor, said: “Life insurance is a crucial financial product to buy if you have dependents. That said, contemplating the aftermath of your death on those you leave behind is hardly a cheery subject to consider. This makes it all the more interesting that some insurers are able to leverage social media to reach a younger audience, even if those numbers are relatively low at the moment.
“Reaching new audiences and customers is important, but insurance providers should make sure they are presenting them with all the necessary information up front. Social media is fast-moving and can be superficial in its treatment of complex topics, so it is beholden on insurers not to gloss over the intricacies and implications of their products when they expose them to the market, whatever the channel.”
