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Life Insurance - Canada - September 2014

Published By :

Mintel

Published Date : Sep 2014

Category :

Life Insurance

No. of Pages : 167 Pages


Greater clarity in their policies, an easy application process, hassle-free payouts to beneficiaries and more disclosure around the compensation model of insurance agents are all steps that the industry could work on to increase trust levels.
Table of Content

Introduction
Definition
Abbreviations
Glossary

Executive Summary
The market
Figure 1: Forecast of values of premiums in the Canadian life insurance market, 2009-19
Market factors
IMF expects the Canadian economy to pick up speed, but many risks remain
Interest rates, inflation and market volatility
Canada’s population is expected to age in the coming years
Companies, brands and innovation
The consumer
Whole/Permanent Life and Term Life are the most widely owned types of life insurance
Figure 2: Ownership of life insurance, June 2014
Manulife and Sun Life dominate the life insurance market
Figure 3: Choice of provider of life insurance, June 2014
A lifestage change is the most common purchase trigger
Low/affordable premiums and a trusted company are the most important factors
Figure 4: Factors considered when buying life insurance, June 2014
46% of Canadians think that it is important for everyone to have life insurance
Figure 5: Attitudes towards life insurance, June 2014
What we think

Issues and Insights
Using life insurance for tax and estate planning
The facts
The implications
Enhancing consumer trust levels with life insurance providers
The facts
The implications
Simplifying and streamlining the application process
The facts
The implications
Engaging the Sceptics by promoting the value of life insurance
The facts
The implications

Trend Application
Trend: Prove it
Trend: Giving Back
Trend: Let’s Make a Deal

Market Drivers
Key points
Economic overview
IMF expects the Canadian economy to pick up speed, but many risks remain
Figure 6: Canada’s GDP, by quarter, Q1 2008-Q1 2014
Figure 7: Household disposable incomes and savings in Canada, Q1 2008-Q1 2014
Figure 8: Canada’s unemployment rate, by gender, 2008-14
Interest rates, inflation and market volatility
Figure 9: Inflation rates in Canada, 2004-14
Outlook on the real estate and housing market
British Columbia has the highest net worth
Figure 10: Canada median net worth, by province, 2012
Demographic overview
Population count and growth in Canada
Figure 11: Share of population of Canada, by territory/province, 2014
Canada’s population is expected to age in the coming years
Figure 12: Population aged 65 years and over in Canada, historical and projected (% of total), 1971-2061
Figure 13: Projected trends in the age structure of the Canada population, 2014-19
Living longer but not necessarily healthier
Figure 14: Average life expectancy* and health-adjusted life expectancy (HALE)**, by disease status and gender, 2013
Regulation and the impact of ongoing regulatory Initiatives

Strengths and Weaknesses
Strengths
Weaknesses

Who’s Innovating?
Key point
Manulife UL
Desjardins launches Life LTC Advance
Compassion insurance from SSQ Financial Group
Industrial Alliance’s Child & Health Duo

Market Size and Forecast
Key points
Canada’s life insurance market continues to grow steadily
Figure 15: Value of life insurance premiums, 2009-19
Forecast
Figure 16: Forecast of values of premiums in the Canadian life insurance market, 2009-19
Forecast methodology

Companies and Products
Manulife
Overview and company information
Recent activity and innovation
Sun Life
Overview and company information
Recent activity and innovation
Great-West Life
Overview and company information
Recent activity and innovation
Industrial Alliance
Overview and company information
Recent activity and innovation
RBC Insurance
Overview and company information
Recent activity
Empire Life
Overview and company information
Recent activity and innovation

Brand Communication and Promotion
Key points
BMO Insurance emerges as the most prevalent direct mailer
Figure 17: Life insurance direct mail acquisition volume, September 2013-August 2014
Featured campaigns from Mintel Comperemedia
Empire Life
RBC Simplified Life Insurance
Guaranteed Life Insurance from Manulife

The Consumer – Ownership of Life Insurance
Key points
Whole/Permanent Life and Term Life are the most widely owned types of life insurance
Figure 18: Ownership of life insurance policies, June 2014
CHAID analysis
Methodology
Fathers with household incomes greater than $75,000 over-index on term life ownership by 16%
Figure 19: Ownership of term life insurance policies – CHAID – Tree output, June 2014
Key driver analysis
Methodology
Indicators: Reasons for purchase and important factors when purchasing life insurance
Estate planning, tax management and buying a property are strong positive drivers to purchase term life insurance
Figure 20: Key drivers of ownership of life insurance, August 2014
Universal and Whole life insurance policies more likely to be purchased directly (non-employer purchase) by consumers
Figure 21: Methods for purchasing life insurance policies, June 2014

The Consumer – Choice of Provider of Life Insurance
Key points
Manulife and Sun Life dominate the life insurance market
Figure 22: Choice of provider of life insurance, June 2014
Regionality brings out some discrepancies
Manulife is the clear market leader among high-income Canadians
Figure 23: Top five providers of life insurance, by household income, June 2014
Most life insurance owners have one provider
Figure 24: Repertoire of choice of provider of life insurance, June 2014

The Consumer – Purchase Triggers for Life Insurance
Key points
A lifestage change is the most common purchase trigger
Figure 25: Triggers for purchasing life insurance, June 2014
Estate planning is a significant purchase trigger for older Canadians
Figure 26: Tax and estate planning as triggers for purchasing life insurance, by age, June 2014

The Consumer – Factors Considered When Buying Life Insurance
Key points
Low premiums and a trusted company are the most important factors
Figure 27: Factors considered when buying life insurance, June 2014
Significant gender differences emerge for several factors
Figure 28: Factors considered when buying life insurance, by gender, June 2014

The Consumer – Attitudes towards Life Insurance
Key points
Summary of attitudes towards life insurance
Figure 29: Attitudes towards life insurance, June 2014
Trust levels are an issue for life insurance companies
Figure 30: Attitudes regarding trust and fairness of life insurance companies, June 2014
A third of Canadians feel that life insurance is less relevant for single people
Figure 31: Attitudes regarding the relevance and importance of life insurance, June 2014
More than a third of Canadians prefer to invest in a savings vehicle rather than buy life insurance
Figure 32: Attitudes regarding affordability and premiums paid, June 2014
More than one in four Canadians feel uneasy about the application process
Figure 33: Attitudes towards the application process and understanding of life insurance products, June 2014

The Consumer – Life Insurance and Chinese Canadians
Key points
Higher rate of Universal life insurance ownership among Chinese Canadians
Figure 34: Ownership of life insurance: Chinese Canadians against Whites/Caucasians, June 2014
Chinese Canadians more likely to choose well-known brands
Figure 35: Choice of life insurance provider: Chinese Canadians against Whites/Caucasians, June 2014
Buying a property and tax management are relatively stronger purchase triggers for Chinese Canadians
Figure 36: Triggers for purchasing life insurance: Chinese Canadians against Whites/Caucasians, June 2014
Chinese Canadians much more likely to believe that life insurance is important for those with children
Figure 37: Attitudes towards life insurance: Chinese Canadians against Whites/Caucasians, June 2014

The Consumer – Target Groups
Three target groups
Figure 38: Target groups for life insurance, June 2014
Sceptics (19%)
Cautious (24%)
Value perceivers (57%)

Appendix – Market Size and Forecast
Figure 39: Best- and worst-case forecasts for the Canada life insurance market, by value, 2014-19

Appendix – The Consumer – Ownership of Life Insurance
Figure 40: Ownership of life insurance policies, June 2014
Figure 41: Ownership of life insurance policies, by demographics, June 2014
Figure 42: Ownership of life insurance policies, by types of retirement accounts, June 2014
Figure 43: Ownership of life insurance policies, by value of retirement assets, June 2014
Figure 44: Methods for purchasing life insurance policies, June 2014
Figure 45: Methods for purchasing term life insurance, by demographics, June 2014
Figure 46: Methods for purchasing whole/permanent life insurance, by demographics, June 2014
Figure 47: Methods for purchasing life insurance – I have life insurance but not sure what type it is, by demographics, June 2014
CHAID analysis
Figure 48: Ownership of term life insurance policies – CHAID, June 2014
Key driver analysis
Figure 49: Ownership of term life insurance – key driver output, August 2014
Figure 50: Ownership of whole life/permanent life insurance – key driver output, August 2014
Figure 51: Ownership of universal life insurance – key driver output, August 2014

Appendix – The Consumer – Choice of Provider of Life Insurance
Figure 52: Choice of provider of life insurance, June 2014
Figure 53: Choice of provider of life insurance, by demographics, June 2014
Figure 54: Repertoire of choice of provider of life insurance, June 2014
Figure 55: Repertoire of choice of provider of life insurance, by demographics, June 2014

Appendix – The Consumer – Purchase Triggers for Life Insurance
Figure 56: Triggers for purchasing life insurance, June 2014
Figure 57: Main triggers for purchasing life insurance, by demographics, June 2014
Figure 58: Other triggers for purchasing life insurance, by demographics, June 2014

Appendix – The Consumer – Factors Considered when Buying Life Insurance
Figure 59: Factors considered when buying life insurance, June 2014
Figure 60: Main factors considered when buying life insurance, by demographics, June 2014
Figure 61: Other factors considered when buying life insurance, by demographics, June 2014

Appendix – The Consumer – Attitudes towards Life Insurance
Figure 62: Attitudes towards life insurance, June 2014
Figure 63: Agreement with the statements ‘I think it is important for everyone to have life insurance’ and ‘I do not trust insurance companies to make paying out a policy easy for beneficiaries’, by demographics, June 2014
Figure 64: Agreement with the statements ‘I do not understand/know enough about life insurance products’ and ‘It\'s better to put money away (eg in savings accounts, RRSPs, etc.) than to pay life insurance premiums’, by demographics, June 2014
Figure 65: Agreement with the statements ‘Life insurance is less important for single people’ and ‘I find it difficult to afford the life insurance coverage I need’, by demographics, June 2014
Figure 66: Agreement with the statements ‘I think that most insurance companies treat their customers fairly’ and ‘It is important to have life insurance only if someone has children’, by demographics, June 2014
Figure 67: Agreement with the statements ‘I think insurance companies are as trustworthy as banks’ and ‘I feel uncomfortable and/or apprehensive about the application process’, by demographics, June 2014
Figure 68: Agreement with the statements ‘I would trust an insurance agent/broker more than an insurance company’ and ‘I think that paying for life insurance is a waste of money’, by demographics, June 2014

Appendix – The Consumer – Life Insurance and Chinese Canadians
Figure 69: Selected demographics by total population against Chinese Canadians, June 2014

Appendix – The Consumer – Target Groups
Figure 70: Target groups, June 2014
Figure 71: Target groups, by demographics, June 2014
Figure 72: Ownership of life insurance policies, by target groups, June 2014
Figure 73: Purchase triggers for life insurance, by target groups, June 2014
Figure 74: Choice factors when buying life insurance, by target groups, June 2014
Figure 75: Attitudes towards life insurance, by target groups, June 2014

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