While consumers’ confidence in the economy has flagged over the past few months, their attitudes toward life insurance companies and financial professionals have surged to record levels.
According to a new study from LIMRA, only 21% of Americans surveyed in May hold a favourable view of the economy, compared to the 25% reported in March and the January record of 56%, which represented the most bullish sentiment on the economy since LIMRA started tracking in 2008.
Two thirds of consumers interviewed said that the U.S. economy is likely or extremely likely to fall into recession this year; the National Bureau of Economic Research has confirmed that the U.S. actually crossed that line in February.
“LIMRA’s most recent consumer sentiment survey shows, while the level of concern has fallen from March, a considerable number of Americans are worried about the impact of this recession,” said Jennifer Douglas, research director, LIMRA Research Quality and Performance.
Douglas noted that in spite of the 10-plus years of economic growth that the U.S. has achieved, many Americans face obstacles to their financial goals. Previous research suggests just 40% of Americans consider themselves on-track in terms of retirement savings, and many are worried about their mortgage payments and monthly bills.
The newest findings show 40% of consumers still believing a recession will heavily affect their discretionary spending (43%), as well as their ability to save for a major expense (41%), retirement (41%), and an emergency fund (40%).
But it seems consumers are becoming increasingly positive when it comes to life insurers and financial professionals. The proportion of respondents citing “quite a bit” or “extreme” confidence in those groups reached record highs, with four in ten expressing those levels of confidence in life insurers and at least one third feeling the same for agents and advisors.
According to Douglas, one third of life insurance policyholders had heard or reached out to their carrier since March; within that group, seven in 10 were satisfied with the service they received, and consequently reported very high levels of confidence in life insurance companies.
“It is important to note, however, that these satisfied policyholders with recent contact represents just over 10% of those surveyed,” she said. “In fact, we see a boost in confidence among owners and non-owners alike.”