For many years, insurance companies focused considerable attention on attracting new clients and increasing sales. But today, the global life insurance market is increasingly talking about a different measure of success: how many clients stay with a company for 10, 20, or even 30 years.
The reason for this shift lies in a problem that was discussed far less frequently in the past. According to the World Life Insurance Report 2027, almost half of clients who discontinue their insurance policies do so within the first three years after purchasing a policy. For insurers, this means losing a client, while for individuals themselves, it means losing the financial protection they once considered important for themselves and their families.
Why Do Clients Give Up Life Insurance?
At first glance, it may seem that the reason is always the cost of the policy. In reality, things are more complicated.
Over time, a person may stop perceiving the value of a product, especially if they have had no interaction with the insurance company for several years. Income, employment, family composition, and life goals change, but the contract remains the same as when it was signed many years ago. As a result, insurance begins to be perceived as just another recurring payment rather than a financial protection tool.
The problem is further aggravated by the fact that many insurers have historically focused on attracting new clients. According to the same report, 36% of policyholders rarely or never receive feedback from their insurance company after signing a contract. Under these circumstances, it becomes more difficult for clients to see the value of insurance protection and maintain a long-term relationship with the company.
A New Model: Ongoing Support Instead of Waiting
That is why an increasing number of leading global insurers are rethinking their approaches to life insurance.
Previously, the model looked like this:
Sell a policy → wait for an insured event,
whereas today it is increasingly becoming:
Sell a policy → maintain a relationship with the client for many years.
In the practices of international companies, regular financial reviews, personalised consultations, and assistance in reviewing insurance coverage following the birth of a child, a career change, or a significant increase in income are becoming more common. Insurers are beginning to support clients through different stages of life rather than simply keeping their contracts in a database.
Essentially, the market is returning to the original idea of life insurance as a long-term partnership. After all, a person's needs at the ages of 25, 35, and 50 are rarely the same.
A New KPI: Not Sales, but Trust
For many companies, this means rethinking their measures of success.
Acquiring a new client is becoming increasingly expensive. Competition for consumers' attention is growing, while digital communication channels are becoming saturated. Under these circumstances, retaining an existing client often delivers greater value than constantly searching for new ones.
That is why long-term loyalty indicators are coming to the forefront:
how many years a client stays with the company;
what percentage of contracts are renewed;
how actively clients use the company's services;
whether they are willing to recommend the insurer to others.
In other words, the insurance market is becoming increasingly interested not in how many contracts were sold today, but in how many people will remain clients ten years from now.
As a result, companies that actively work on attracting and retaining clients throughout their entire life cycle have a 12% lower policy discontinuation rate compared with other market participants.
What Does This Mean for Clients?
At first glance, it may seem that this trend matters only to insurance companies. In reality, both sides benefit.
When an insurer maintains regular contact with a client, it becomes easier to adapt the contract to new life circumstances. People gain a better understanding of exactly what they are protected against, what changes should be made to their insurance programme, and how insurance fits into their long-term financial plan.
Furthermore, this interaction helps prevent situations in which a person discontinues a contract simply because they have lost touch with their original motivation for purchasing it. After all, in the years following the purchase of a policy, the need for financial protection usually does not disappear.
The Future of Insurance Is Built on Relationship
Life insurance is gradually moving away from a model in which purchasing a policy was the main event. For many of the world's leading insurance companies, the story that begins after the contract is signed is becoming increasingly important. The longer the relationship between an insurer and a client lasts, the more opportunities there are for effective financial planning, timely updates to insurance protection, and greater confidence in the future.
For TAS life this approach is not new. We believe that the value of life insurance is truly realised over the long term, when a company remains by its client's side through different stages of life. That is why one of our main priorities is long-term trust and lasting relationships with our clients. This idea is also reflected in our slogan: “Your Insurance Company for Life.”
