nov 2014 Presentation for Gramercy Forum Nov 2014 - DB and Multicultural FINAL FLAG (1)

The Death and Rebirth of Life Insurance:

How marketing directly to Middle Market and Multicultural

customers is critical to reviving the business

November 2014

© 2014 Metropolitan Life Insurance Company, NY, NY 10166

US Direct Business-Strategy & Planning

US Life insurance industry performance

2


Bottom

90%

The Focus Has Been on the Affluent

-$500

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

1989 1992 1995 1998 2001 2004 2007 2010

US$

(0

00

s)

<25 25-49.9 50-74.9 75-89.9 90-100

Percentile of Net Worth

Top 10%

U.S. Households

Net Worth by Percentile „89-‟10

source: http://www.census.gov/hhes/www/income/data/historical/household/ 3

• Focusing on such a small segment of the population is a dangerous

long-term strategy for growth


The Last 70+ Years: Worrisome Trends

4

POPULATION

311,590,000

132,120,000

US Census Data 1940-2011

2X

17,872,000

9,500,000

POLICIES PURCHASED

50%

LIMRA’s U.S. Individual Life Insurance Sales Survey and LIMRA Estimates, 2011


Number of Agents Declining

5

0

100,000

200,000

300,000

1973 1989 1993 1996 1998 2001 2004 2007 2010

36 % DECLINE

256,735

163,814



Individual life insurance has continued to move up

market and has become a “niche” product…

U.S. Individual Life Insurance Industry

Average face size of the policies, 1985-2010, $ 000‟s

6

53 56 61 64

69 76 77 79 81 84

89 95

106 115

131

149 143

152 157

165 172

177

195 194

183 177

+233%



Nu

mb

er

of

US

Ho

useh

old

s

< $100K $200K + $100- $200K

7

But Life Insurance Industry is Not Keeping Up

Population Is Changing

Annual Household Income

US Population

Life Insurance

Ownership

Life

Insu

ran

ce O

wn

ers

hip

%


US Direct Business-Strategy & Planning 8

Typical families don‟t have enough left over each

month to pay for expensive coverage.

Typical Household Budget High Cost Structure

Losing the Mass Market Battle

Administration

Underwriting

Distribution

Claims

Discretionary

Spending


Consumers’ purchasing

behavior has changed.

We need to change along

with it.


Just as America is looking less like this…


And more like this…


THIS

CANNOT

BE YOUR

FATHER‟S

INSURANCE

BUSINESS.


Yet look at who is portrayed in Life Insurance ads

13


Lots of people want life insurance…so why do so many fail?

14

Over 60M people will shop for life insurance in the next 12 months1…and industry

research shows there is a $20Trillion coverage gap in the U.S. – highest worldwide

2013 U.S. population >18

years old

% planning to shop for or

purchase life insurance

over the next 12 months

Potential market:

Source: [1] MetLife Q1 2014 Segment Quantitative Survey; Q11. Do you plan to shop for or purchase any of the following life insurance products over the next 12 months? This includes

purchasing new products, adding additional coverage, or switching providers. Select all that apply.

242 Million

25%

60 Million

Yet Research shows 9 out of 10

who start the process - fail.

25% 25% 24% 25% 26% 28% 23% 21%

27% 25% 23%

45%

59% 66%

79% 85% 87%

81% 79%

66%

0%

20%

40%

60%

80%

100%

>$15 $15 -24.9

$25 -34.9

$35 -49.9

$50 -74.9

$75 -99.9

$100 -149.9

$150 -199.9

$200+ U.S.Market

Intend to Purchase w/in 12 months Insured

Opportunity with multicultural and lower-income sub-segments

15

Note: [1] Coverage is self-reported and weighted to be consistent with the U.S. Market/ LIMRA‟s “The Facts of Life and Annuities – 2013”; [2] Excludes all other and mixed races, ~2% of the

mkt

Source: U.S. Census Bureau (2013 population estimates under the age of 18 from 2012); Q1 2014 U.S. Direct quantitative survey, Q1. Which of the following financial products and/or services

do you currently have or use?; Q11 Do you plan to shop for or purchase any of the following life insurance products over the next 12 months? This includes purchasing new products, adding

additional coverage, or switching providers. Select all that apply.

Multicultural consumers indicate significantly

higher purchase intent than Caucasians (20%),

led by Hispanics (37%) and Blacks (31%)

Purchase Intent by Ethnicity1,2

31%

20% 27%

37%

25%

0%

20%

40%

Black Caucasian Asian Hispanic U.S. Market

Intend to Purchase w/in 12 months

Intend to Purchase w/in 12 monthsCoverage & Purchase Intent by Household Income1

The vast majority of uninsured consumers

are Middle Market (under $100K household

income):

- 80% of the 123 million U.S. households,

and 90% of uninsured households are

Middle Market

- Purchase intent is relatively consistent

across income levels, indicating a greater

opportunity to serve Middle Market

consumers


US Direct Vision

16

We help people act on their best intentions to protect their financial

future – for themselves and their loved ones

125MM people in the underserved US Middle Market

US Middle Market = $20 billion premium opportunity

60MM people will shop for life Insurance in next 12 months


MetLife US Direct is designed to transform the way life insurance is

understood and experienced by the middle market…

Developing new tools to educate

and empower

Re-engineering process to be fast

and painless

Opening new distribution channels

Creating a better, best-in-class

consumer experience… one that

continues beyond the initial sale

Transform the industry by...

1

2

3

4

17

That will be reflected in our...

Strategy

Business Model

Org.

Structure

Results


Simpler products

• SIT – Simplified Issue Term, Up to $100K in coverage, two

medical questions, MIB check, 5-year pricing banding.

Ages 18-80.

• GALI – Guaranteed Acceptance Life Insurance, designed

to cover final expenses (medical bills, credit card debt, and

funeral costs). Up to $50K in coverage, no medical

questions or exams. Ages 45-75.

• AD – Accidental Death, covers death resulting from

accident. Up to $500K in coverage, no medical questions

or exams. Ages 18-75.

18

The Simplified Issue Term Life Insurance Policy is issued by MetLife Insurance Company USA, Charlotte, NC 28277 (form # 5E-26-12) and in New York by Metropolitan Life Insurance

Company, New York, NY (form # 1E-26-13-NY). Guaranteed Acceptance Life Insurance Policy (5E-13-13) is issued in all states except NY by MetLife Insurance Company USA, Charlotte, NC

28277 and in NY (1E-13-13-NY) by Metropolitan Life Insurance Company, NY, NY 10166. The Accidental Death Life Insurance Policy is issued by Metropolitan Life Insurance Company, New

York, NY 10166 (form # 1EAH-10-13).


Simpler Process – Customer Centric Functionality

• Simplified application using

new standards

• Mobile application

• ePolicy access

• Formalized onboarding with

welcome call, email

• Payment reminders

• Credit/debit payments

• “Pick your date” payment option

Highest NPS scores in the industry!

19


Sponsor Micro site Emails

Mail Click to Call Social Media Search

Display Ads

DRTV

Kiosk

Simpler engagement – advertising where the

customer is, rather asking them to come in

MetLife.com


Even in Walmart!

• Yearly renewable term life

• $5 first month regardless

age, face, or gender

A new look. A new location. A new approach.

21

This Renewable Term Life Policy is issued by MetLife Insurance Company USA, Charlotte, NC 28277 (form # 5E-27-13).


Affordable rates for coverage

Simplified Issue Term*

coverage

Guaranteed Acceptance Life

Insurance (GALI)

22

* For $10K in coverage


Messaging based on customer insights and overcoming barriers:

DRTV – Leveraging Multicultural insights for Guaranteed Acceptance

23

A multi-generational family is featured, all segments are represented.

Matriarch is head of household.

Guaranteed

Acceptance product

indexes highly with

African American

adults.

African American family

is featured in this spot.

Mom introduces the

topic in this spot.


Need to act like a Direct Marketer - Optimizing advertising

Datamart

Targeting

O

E

T

D

M

Paid Search

Email

Telemarketing

Website Visit

Online Search

Email Inquiry

Call Center Call

W

O

E

C

Direct Mail

Mass Media

PPrint Media

D

Click ThroughC

Retail VisitR

Social ParticipationS

Display

Marketing Driven Activity Consumer Driven ActivityM C

Segmentation

Segment A15%

Segment B19%

Segment C32%

Segment D12%

Segment E21%

•College & graduate students

•New workforce

•Mostly female

•30 & single

•Mostly male

•New Parents & suburban families

•Empty Nesters & Families w/ teens

De

mo

s

Cu

sto

me

rB

eh

av

iors

Me

dia

Pre

fere

nce

s

•Buys online

•Lower order value

•Skews female

•Frequent purchaser

•Higher order value

•Less frequent buyer

•Wide range of product range

•Prefers offline

•Responds to DM

•Youtube & Text

•Prefers humor in advertising

•Email

•Online advertising

•ESPN & TNT

•Business Week

•Heavy online

•Parenting mags

•Disney channel & websites

•Time, WSJ, Forbes

•Prefers quality of service

Measure / Report

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

% F

req

ue

nc

y

0

20

40

60

80

100

120

140

160

180

200

Ind

ex

Baseline 33.5% 7.6% 7.2% 11.5% 11.6%

PayPal 45.4% 13.6% 10.8% 15.8% 16.6%

Index 135 178 150 138 144

Yes 0-3 Years Old 4-7 Years Old 8-12 Years Old 13-18 Years Old

Indicates the presence of children in the household

Campaign Mgmt

Media

0

20

40

60

80

100

120

140

160

180

200

0.0 24.0 48.0

Incre

me

nta

l R

ev

en

ue

Investment Amount

Print

Radio

Direct Mail

TV

Year 1 Year 4Year 3Year 2Time

Reven

ue

24


But it is working…

• MetLife is the fastest growing direct life insurer in the

industry according to LIMRA (U.S. Individual Life Insurance

Sales Survey and LIMRA Estimates, 2011)

• The Direct business is the highest source for life insurance

applications in MetLife

• Multi-cultural customers significantly over-index as a

percentage of the total book of business

• 95% of the policies we originate are new policies, not

replacements!

25


THANK YOU

28

Metropolitan Life Insurance Company, NY, NY

L1114399356[exp0415][AllStates][DC,PR]

nov 2014 Presentation for Gramercy Forum Nov 2014 - DB and Multicultural FINAL FLAG (1)

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