Life insurance customers in the US are eager to receive electronic prospectuses and other related compliance documents, but insurance firms are not meeting the demand, shows research.

According to a study commissioned by NewRiver - a financial services customer data systems provider - there is strong demand from variable annuity (VA) and variable universal life (VUL) policy holders to receive prospectus and compliance documents electronically.

More than half of the respondents who were not offered electronic delivery of documents from their VA/VUL company said they would be interested in electronic delivery if it were available. Yet despite this opportunity, said NewRiver, the insurance industry appears to be lagging behind other industries in effectively marketing and offering their e-delivery capabilities.

While respondents were split in their assessment on how their VA/VUL provider was promoting e-delivery, only one in four (26%) could ever recall being notified about the option.

Having said that, the research found that less than a third of the VA/VUL customers (29%) actually read their hard copy prospectus and other documents they receive, including a mere 6% who claim to read these documents from cover to cover.

Asked what was preventing them from using e-delivery, nearly three out of five (59%) respondents said it was due to the difficulty in reading compliance documents online.

NewRiver said electronic summary prospectus documents were the way forward. “The summary prospectus is good news for policy holders who find online documents difficult and unwieldy,” said Russell Planitzer, CEO at NewRiver. “The availability of the new shorter summary prospectus makes finding relevant information easier."

Planitzer said there has "long been a misconception" within the insurance sector that due to its older customer demographics there isn’t a high level of interest in electronic delivery, or that reading and accessing documents online is difficult. He said the research dispels this "myth", as the majority of those who were either not offered or were not aware of the option of electronic delivery expressed an interest in it.

For the research, NewRiver commissioned Mathew Greenwald & Associates to survey more than 500 consumers who own a variable annuity or variable universal life policy.