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The Power of Focus: A Case for Collective Action to Bridge the Coverage Gap

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In November 2020, I joined RGA as the Head of U.S. and Latin American Markets after more than three decades with insurance carrier organizations.


For all my time in the industry, the events of the last 12 months were the most transformative; these recent days demonstrated, as nothing else could, the importance of what carriers do to protect lives and livelihoods. The pandemic also underscored how much work still lies ahead.

That is why RGA partnered with seven U.S. life insurance trade associations, numerous life insurers, and financial security professionals for Help Protect Our Families. The goal of this industry-wide initiative is to raise awareness about the value of life insurance and address America’s steadily growing financial protection gap.

The COVID-19 crisis highlighted the need for financial protection like no other point in our lifetimes. Most of us have stories about family, friends, coworkers, or neighbors who now face uncertainty after losing a loved one during this historic crisis, particularly if that person was the primary earner.

In 2020, just 54% of Americans had life insurance coverage, a nine-point decline from only a decade ago, according to research by LIMRA and Life Happens. And even those who have some coverage may not have enough. Researchers at LIMRA also estimate 60 million U.S. households are underinsured or uninsured as the average coverage gap between what is needed and what exists has reached $200,000.

Many insurers have long attempted to educate Americans about the role life insurance plays in their financial security. After 33 years on the front lines of life insurance distribution and sales, I am painfully aware of how difficult it can be to expand a market when so many potential policyholders are confused, distracted, or disengaged. At the same time, carriers must also contend with other industry-impacting issues, such as low interest rates, regulatory changes, tightening budgets, and increased competition. While our industry cannot prevent the current human tragedy unfolding around the world, we have an obligation – and an opportunity – to protect many more people.

We can only accomplish this by banding together.

Defeating consumer apathy, confusion, and distrust requires insurers to act collectively, and that is where Help Protect Our Families can make life coverage a priority for more people. This effort pools resources across LL Global, the parent organization of LIMRA and LOMA, the American Council of Life Insurers, Finseca, Life Happens, Million Dollar Round Table (MDRT), National Association of Insurance and Financial Advisors (NAIFA), and National Association of Independent Life Brokerage Agencies (NAILBA), as well as multiple carriers, agencies, brokerages, and reinsurers like RGA. By working together and sharing insights and innovations, we gain a stronger voice and a better chance to reach uninsured Americans and convince these consumers to secure the financial protection they need. The size of this underserved market – now estimated at $12 trillion – justifies the need for this collective effort.

The COVID-19 pandemic has forced a reckoning as we confront the fragility of life and persistent financial inequities. Together, insurers, reinsurers, associations, and our broader industry have a unique opportunity to lead change, address disparities in insurance protection, and fulfill our noble purpose of providing financial peace of mind.

To learn more about the campaign, visit https://www.limra.com/helpprotectourfamilies.

 

The Author

  • Ron Herrmann

    Executive Vice President
    Head of U.S. and Latin American Markets

Summary

For RGA's Ron Herrmann, COVID-19 demonstrated, as nothing else could, the importance of what carriers do to protect lives and livelihoods. He calls on the industry to band together to raise awareness about the value of life insurance and address America’s steadily growing financial protection gap through a new partnership: Help Protect Our Families
 
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