Experts at Conning Research & Consulting say life insurers have been missing a golden opportunity in the middle market over the last five years. The protection gap for this segment is now estimated at $10.2 trillion.

"The financial crisis and recession had far-reaching effects on income, asset values, and debt levels, all of which combined to drive the increased size of this missed opportunity," says Terence Martin, director at Conning Research & Consulting. "In addition, the rising cost of health care, especially in the middle market, may be an emerging, largely unrecognized need for life insurance planning. The question now is whether insurers can harness available new technologies to actually meet this burgeoning need."

"There are significant challenges to life insurers seeking to penetrate the middle market," says Stephan Christiansen, director of research at Conning. "Those challenges relating to distribution—cost, access, and others—may finally be eased by the increased use of the internet channel and social media marketing support. For insures struggling with the cost of underwriting, the implementation of predictive modeling and a more automated underwriting process holds promise. As insurers seek growth in the recovering economy, they will be analyzing the technology commitment needed to succeed in middle market and weighing that against the significant opportunity."