By Ryan Weeks on Tuesday 15 November 2016
Millennial lending platform SoFi branches out into insurance just two weeks after launching latest product for homeowners.
SoFi just does a bit of everything. Barely two weeks after launching a new refinancing product for homeowners with Fannie Mae, the online lending company has announced its first foray into the insurance space. SoFi has launched a new term life insurance product in partnership with Protective.
Protective, founded in 1907, has around $76.2 billion in assets, with a customer base of close to 8 million people. But the old-school firm’s latest initiative with SoFi will be anything but old-school. The term life insurance offering will provide up to $1m in coverage via an online application process, with “competitive pricing and no medical exam for a majority of people under 40”.
This is just SoFi’s latest attempt to adapt traditional financial services mainstays to better suit millennials. The firm says that such customers are “especially in need” of adequate life insurance coverage as they hit major milestones, such as homeownership and starting families.
Data from the 2016 LIMRA Ownership Study reveals that millennials are the least likely of all generations to have existing life insurance coverage. Furthermore, one in three households would have immediate trouble paying living expenses if they were to lose their primary wage earner, with millennials “most at risk”. The study finds that millennials tend to overestimate the cost of life insurance premiums by a massive 213 per cent.
The newly available policies will be issued by Protective Life Insurance Company. Applicants will be able to speak to a licensed Protective insurance advisor over the phone if uncomfortable with an entirely online application experience.
"This is a first in the industry: coverage in minutes without a medical exam in many cases, and at incredibly competitive prices," said Andrea Blankmeyer, VP of finance at SoFi. "Protective has more than 100 years of experience providing valuable protection to nearly 8 million customers, and we're happy to work together with them to deliver what we think is the easiest experience for buying term life insurance."
In addition to churning out a seemingly constant stream of new products, SoFi is also rumoured to be eyeing international expansion, with Europe and Asia in its sights. Apparently nobody has informed the company that 2016 is a “down year” for alternative finance.