AM BestTV: U.S. Life Fraternals Could Harness Social Media and Education to Grow Membership, Say AM Best Analysts
OLDWICK, N.J.--(BUSINESS WIRE)--Nov 6, 2019--
In this AM BestTV episode Edward Kohlberg, director, and David Marek, financial analyst, both with AM Best, explain how the U.S. fraternal life insurers are challenged by a competitive middle market and shrinking consumer wallet, but could see potential growth through education and tapping into social media. Click on http://www.ambest.com/v.asp?v=fraternals1019 to view the entire program.
Marek addressed the issue of why fraternals struggle to grow membership and what can be done about it.
“There are several reasons that fraternals have struggled,” said Marek. “One reason is a lot of them participate in the middle market, which is highly competitive for both fraternals and non-fraternals. Additionally, there is a shrinking consumer wallet due to economic constraints, as well as younger generations that are waiting longer to start families and have children……I believe what fraternals can do to grow membership is to utilize social media to promote the social benefits of their companies, as well as educate the consumer on their products.”
However, fraternals have improved their operating results. Kohlberg discussed how fraternals are accomplishing this improvement.
“Some companies are performing better than others. When it comes to the operating earnings for the whole industry, it is really being driven by the three or four largest fraternal companies, which make up the vast majority of the premiums and earnings for the industry……..When you look at operating performance for certain companies, these fraternal organizations have been around for a long time, and they have very large in-force books of business that continue to run off. As they run off, this generates earnings for the organization. The challenge is growing the premiums to new premiums to offset the decrease in run off renewal premiums,” he said.
To access a copy of this market segment report, titled, “U.S. Fraternals Face a Difficult Growth Environment,” visit http://www3.ambest.com/bestweek/purchase.asp?record_code=290659.
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KEYWORD: NEW JERSEY EUROPE UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: INSURANCE PROFESSIONAL SERVICES
SOURCE: A.M. Best
Copyright Business Wire 2019.
PUB: 11/06/2019 01:46 PM/DISC: 11/06/2019 01:46 PM