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Wellness/Consumer Engagement

How Insurers Can Improve Retirement Readiness and Financial Wellness in the Time of COVID-19

Retirement long

The pandemic has upended plans for those approaching or planning for retirement, but innovative insurance offerings could help provide a solution.

The pandemic and its accompanying economic disruptions have added more uncertainty to an already difficult life transition, pushing some to accelerate retirement and others to indefinitely delay plans.

Rising concern is translating into a greater interest in insurance generally, and it may be driving insurers toward a more of a holistic set of wellness offerings that can include financial tools, planners, and programs.  Consider findings from a recent RGA global survey of more than 107 major insurers: Almost a quarter of respondents reported offering financial wellness or financial health planning services, and 27% saw growth potential in financial health.

To understand the popularity of financial services, consider that planning for retirement can be intimidating and particularly problematic for those who have no financial planning or resources. Retirees need tools to plan their financial security and to address fear of running out of money or of market losses eroding their retirement savings.  Retirement readiness requires workers to start saving early and habitually, pursue a retirement strategy, create a backup plan for unforeseen circumstances, minimize healthcare costs through healthy lifestyle choices, and embrace lifelong financial learning. This is a heavy burden in the best of times, and surveys from an array of insurers and wealth management firms taken since the onset of the pandemic have found that consumers around the world are increasingly anxious about their readiness for this next phase of life.

In the U.S., one in four employees aged 50 or older expects to retire later than planned, with more than one third of older employees (35%) planning to retire at age 70 or older.[1] Market research in Canada[2] found a striking lack of retirement readiness among people aged 55 to 64, with 33% of working Canadians sharing plans to postpone retirement due to inadequate savings and investment losses. In the U.K., a gulf is emerging[3] between planners and those who are unfocused on retirement: almost two thirds (64%) of those with a written retirement plan save habitually, compared to just a quarter (26%) of those who do not have a retirement plan, suggesting that simply creating a plan may encourage people to think about and save for retirement. A survey sponsored by a major insurer in November 2020 found a surge in interest in retirement planning products across eight markets (mainland China, Hong Kong, Indonesia, Japan, Malaysia, Philippines, Singapore, and Vietnam).

Uncovering Inequalities and Commonalities

RGA’s research suggests that insurers increasingly view wellness offerings, including financial health services, as a method to provide support and tools to promote overall better health. And yet many people still struggle with financial wellness despite the rising popularity of these products. In a survey by Prudential, more than 75% of U.S. employers reported providing education and resources needed to plan for retirement, yet half still express concern about overall low preparation on the part of their workers[4]. Alarmingly, 49% of workers said they don’t understand retirement saving or investing strategies. In Canada, 90% of respondents to a Manulife Investment Management survey felt that it is important for employers to offer financial wellness programs, but only 30% reported that their employers offered “fairly extensive” or “very extensive” financial wellness programs.[5]

The good news? In North America, insurer-led employee benefit reviews and educational resources are helping employees understand possible paths to retirement and could improve employee engagement and loyalty. Employers are hosting workshops[6] and consultations to talk about preparing for retirement.

For those who do not have the benefit of professional advice, a comfortable retirement can resemble a distant dream. An August 2020 survey from LendingTree and the investing app Stash[7] found wide gaps in retirement preparation across the workforce. Low-income individuals are about twice as likely to delay retirement as their high-income counterparts. The survey also estimates that 30% of Latino workers and 28% of black workers expect to delay their retirement plans, compared to 23% of white Americans. Gender gaps are also emerging in regions with historical earning disparities or disproportionate rates of unpaid caregiving that challenge women to accumulate retirement savings.

Despite disparate levels of retirement knowledge and support, concern about savings levels is global and may be worsened by economic disruptions wrought by the pandemic. In the U.S., 40% of workers[8]  are concerned about outliving retirement savings, and 70% report interest in employer-sponsored retirement plans with guaranteed lifetime income. In the U.K[9], where 2.8 million individuals have fallen into arrears on rent, council tax, and utilities bills since the start of the coronavirus lockdown, 36% of people say “not earning enough to save” is the biggest barrier to saving for retirement. Also, many older Australians live with the worry that they might outlive their savings and be wholly dependent on Australian age pension, according to a study by National Seniors.[10] 

Creating a Culture of Savings

These trends may be sobering, but they are not insurmountable. Increasingly, insurers are developing an array of platforms, tools, and apps to help policyholders plan for a comfortable retirement based on personal goals and unique needs. One multinational insurer devised a new, highly visual dashboard that allows customers to assess their retirement readiness across several key metrics and identifies opportunities to improve outcomes. A companion retirement app offers estimated spending and income in retirement and features saving scenarios to help customers model and track their performance against goals. Similarly, myHealthMoney assists employees in navigating the maze of workplace benefits to recommend the best fit based on family size, typical healthcare spending, retirement dates, savings goals, and risk appetite. Other resources include a budget calculator and educational offerings on saving, debt management, retirement investment, and navigating market volatility.

Some tools go beyond planning to also assist with facilitating and managing investments. One insurer’s new in-plan Managed Retirement Fund and Managed Cash Flow option grants employees nearing retirement access to a low-cost, professionally managed fund that adjusts with age. In Canada, the Omni mobile app gives employees a simple and user-friendly way to manage group benefits and retirement savings plans. Members can make health insurance claims, complete their group retirement savings transactions, and access practical tools and resources for their health and financial wellness. The investment firm Blackrock’s LifePath Paycheck is an investment solution that combines the lifetime income stream of a defined benefit plan with the flexibility of a defined contribution plan through a digital platform. Similarly, a major U.S.-based insurer has teamed up with an insurtech to launch Lifetime Income Builder, an innovative investment vehicle that combines a fixed indexed annuity with a guaranteed lifetime withdrawal benefit.

Financial personalization is an emerging, and promising, trend. One insurer’s Retirement Pathfinder tool allows users to construct a personalized retirement plan with the help of a financial advisor by modelling savings strategies. The insurtech Retirable offers a free personalized retirement roadmap for users impacted by the pandemic. And the AMBER Adviser offered by a Singapore-based insurer connects customers to local service providers for needs ranging from nursing home referrals to dental care based on individual financial considerations and targets.

What lessons can we take from this incredibly vibrant landscape of product options?   There is a growing need for financial literacy tools to offset any negative financial impacts from unexpected shocks such as a pandemic. Insurers have a significant role to play in helping people achieve this level of ongoing financial wellness. By developing innovative tools and programs to engage customers in planning, insurers can help many more people enjoy their golden years.


[1] Financial situation has worsened for 1 in 4 full-time U.S. employees, Willis Towers Watson survey finds - Willis Towers Watson

[2] How the COVID-19 pandemic may sabotage retirement for boomers and Gen X - The Globe and Mail





[7] Lincoln Financial adds personalized retirement service with advisor managed accounts

[8] 4 in 10 Americans Weren’t Financially Prepared for Pandemic (

[9]  Retirees maintain savings and investment plans in short term, cautious about 2021 economic outlook | Principal




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