Exclusive Research

THOUGHT-LEADINGINSIGHTS FROM

HOMESTEADERSLIFE COMPANY

Pre-need Motivators

Learn the real reasons why consumers make advance funeral plans.

5th Edition

NEW in this edition: Funeral director perceptions about

pre-need client families.

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Table of Contents Pre-need Motivators 5th Edition

Introduction ............................................................................ 3

Pre-need Policy Owners ...................................................... 4Gender .......................................................................................5 Marital Status ..........................................................................6 Age/Generation ......................................................................7Ethnicity ....................................................................................8 Religious Affiliation ..............................................................9Internet Use .......................................................................... 10

Pre-need Decision-making ..............................................11First Information Source .................................................. 12Time to Action ..................................................................... 13Reasons for Timing ............................................................ 14Importance of Reasons .................................................... 15Firms Considered................................................................ 16Cremation ............................................................................. 17Online Research .................................................................. 18

Experience and Reactions ................................................19Who Attended ...................................................................... 20Location ................................................................................. 21Satisfaction ........................................................................... 22Recommendations ............................................................ 23

Methodology and Sources ................................................24

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Introduction

For more than a decade, funeral professionals across the country have relied on Homesteaders’ Pre-need Motivators report to learn the real reasons behind consumers’ decisions to prearrange and about their experiences before, during and after they finalize their advance funeral plans. The publication represents the only study of its kind, reporting on responses from individuals who have funded advance funeral plans with our affiliated funeral homes.

Now in its fifth edition, Pre-need Motivators includes new data and insights that will allow you to better serve your client families. In addition to offering updated research on important topics we have been tracking over the years, we’ve added new categories to better reflect consumers’ changing communication preferences and service needs.

Consumers’ perceptions of the prearrangement conference are only part of the pre-need experience. For this edition, we conducted a survey of funeral directors to learn about their perceptions of pre-need as well as what consumers experience when a prearrangement becomes an at-need funeral. These results illustrate contrasts between funeral professionals’ perceptions and consumers’ preferences.

Despite some differences, you’ll be pleased to discover that both groups demonstrated agreement on a very important point: pre-need continues to be highly valued by consumers and funeral professionals. We’re confident the findings in this latest edition of Pre-need Motivators can help you develop and grow a successful pre-need program.

Get ideas about the next steps for your

funeral home.

Watch for these symbols throughout the report:

Watch videos related to the research and

insights in the report.

Learn about funeral directors’ perceptions

of pre-need.

Introduction ............................................................................ 3

Pre-need Policy Owners ...................................................... 4Gender .......................................................................................5 Marital Status ..........................................................................6 Age/Generation ......................................................................7Ethnicity ....................................................................................8 Religious Affiliation ..............................................................9Internet Use .......................................................................... 10

Pre-need Decision-making ..............................................11First Information Source .................................................. 12Time to Action ..................................................................... 13Reasons for Timing ............................................................ 14Importance of Reasons .................................................... 15Firms Considered................................................................ 16Cremation ............................................................................. 17Online Research .................................................................. 18

Experience and Reactions ................................................19Who Attended ...................................................................... 20Location ................................................................................. 21Satisfaction ........................................................................... 22Recommendations ............................................................ 23

Methodology and Sources ................................................24

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Effective funeral home marketing messages should directly address the high-priority needs of your potential client base. Without a full understanding of the demographics and information preferences of your pre-need program’s most likely customers, you’ll run the risk of losing out on potential new business and opportunities to build brand loyalty in your community.

Our survey of policy owners included demographic and behavior-related questions to help better understand the people who have funded their advance funeral plans with a Homesteaders policy. These results can be useful in identifying the people who may be most receptive to messages about advance funeral planning. As you read the information, consider how your firm can reach out to potential clients in your community through direct mail initiatives, digital communication, pre-need seminars, public relations events and other marketing activities.

Next Steps: Demographic Research

National consumer data is a great starting point, and it’s even better to get a local perspective about your community and how its population may be changing. Homesteaders provides demographic data analysis services that can help you make informed marketing decisions for your funeral home. Contact your Homesteaders account executive to learn more.

Pre-need Policy Owners

To see exclusive video content, visit: homesteaderslife.com/pnm-videos

GenderWomen are more likely to own pre-need policies than men. When developing your firm’s marketing materials, address the needs of female household decision-makers and ensure your communication methods and content align with their preferences.

According to a 2018 social media report by the Pew Research Center, 74% of U.S. adult women are active on Facebook. Your funeral home’s social media can help build awareness and engagement with members of your community.

41% Men 59% Women

Gender Makeup:Prearrangers

Gender Makeup:U.S. Population

49% Men 51% Women

Pre-need Policy Owners

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Marital StatusA significant percentage of pre-need policy owners are widowed individuals. Consider programs and services your firm can offer to help meet their needs.

Aftercare services are an important way your firm can provide assistance and help extend relationships with client families. Funeral professionals may choose from a large selection of aftercare offerings depending on the needs of their community. These range from comprehensive programs with support groups and grief counselors to online bereavement libraries and printed educational materials.

Pre-need Policy Owners

0% 25% 50% 75% 100%

57%

51%

25%

6%

18%

43%

Married

Widowed

Single

■ Prearrangers ■ U.S. Population

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Age/GenerationPre-need policy owners are significantly more likely than the general population to be age 60 or older. Ensure your offerings are relevant to the experiences of people in this group and their family members.

Online marketing offers ever-growing opportunities to reach an increasing number of senior citizens. A 2018 Pew Research Center report revealed that 66% of seniors (ages 65 and older) go online, up from just 43% a decade ago.

Pre-need Policy Owners

80%

60%

40%

20%

0%2%

22%

7%11%

27%

9%

63%

7% 3% 0.3%Generation X (Ages 37-52)

Generation Jones (Ages 53-61)

Leading Edge Boomers

(Ages 62-71)

Silent Generation (Ages 72-92)

GI Generation (Ages 93+)

■ Prearrangers ■ U.S. Population

7

8

EthnicityThe U.S. population continues to become increasingly diverse. Growing markets, especially in the Hispanic population, present unique opportunities for funeral professionals.

Consider how your funeral home can meet the needs of a diverse population, including ensuring your communications and educational materials represent the languages spoken in your area. In addition, pursue new offerings and partnerships that can help you serve more families in your community.

Pre-need Policy Owners

100%

80%

60%

40%

20%

0%

91%

72%

4%

16%

4%13%

2%

15%

Caucasian Hispanic African American Other

■ Prearrangers ■ U.S. Population

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Religious AffiliationConsumers who prearrange are significantly more likely than the general population to indicate a religious affiliation. It is worthwhile to cultivate mutually beneficial relationships with local religious organizations and leaders, discussing ways you can work together to better serve the people in your community.

In recent years, there has been an increasing number of religiously unaffiliated people (sometimes referred to as the “nones”) in the general population. It’s important to ensure your firm is also prepared to meet the funeral planning needs of this group.

Pre-need Policy Owners

100%

80%

60%

40%

20%

0%

92%

77%

8%

23%

Indicated a Religious Affiliation

No Religious Affiliation

■ Prearrangers ■ U.S. Population

Internet UsePrearrangers use the internet for a variety of activities, with email and searching for information being the most common. Your funeral home website offers an important way for your potential client families to learn more about your services.

A 2015 FAMIC study shows that adults’ use of the internet for funeral-related information has increased significantly over the past few years. Ensure your website incorporates search engine optimization (SEO) best practices to achieve a higher ranking in the search results, which will help families connect with your valuable online content.

Top Online Activities for Prearrangers...

46% of prearrangers use email.

40% of prearrangers use the internet to

search for information.

22% of prearrangers use online banking.

27% of prearrangers go shopping online.

24% of prearrangers are active on social media.

19% of prearrangers play games online.

Pre-need Policy Owners

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We asked policy owners to tell us more about their motivations for prearranging and why they decided to make advance funeral plans when they did. This is important to understand so you can better identify and communicate with the consumers who are most likely to be receptive to the benefits of pre-need.

The survey results reveal that many people who prearrange do so to relieve burdens from their family members. Many of them have recently experienced the death of a friend or family member, which may have caused them to consider their own memorialization preferences and think about who will be responsible for planning the funeral when the time comes.

The data shows that prearrangers believe advance funeral planning is a powerful gift. An excellent way to share the benefits of prearranging is through the stories of people who have actually done it.

Next Steps: Community Presentations

Community presentations are among the best ways to engage in face-to-face conversations about pre-need in a comfortable setting. Homesteaders’ popular Think of Me When...® program (available in English and Spanish) includes video testimonials from people who have prearranged, as well as all the materials you’ll need to lead a discussion. Contact your Homesteaders account executive for details.

Pre-need Decision-making

To see exclusive video content, visit: homesteaderslife.com/pnm-videos

First Information SourceMost policy owners learned about pre-need from someone who had already prearranged. This finding reinforces how important word-of-mouth referrals can be for your pre-need business.

When following up with pre-need clients, encourage them to share their positive experiences with others who would benefit from advance funeral planning. In addition, provide ongoing value for them by extending invitations to special events your firm hosts.

Pre-need Decision-making

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How did you first find out about prearranging?

0% 25% 50% 75% 100%

56%

18%

8%

3%

1%

17%

Knew someone who had prearranged.

Heard about it from a funeral professional.

Saw or heard an ad.

Attended a presentation.

Learned about it on the internet.

Found out about it from another source.

Time from Decision to ActionMany consumers need a couple of years after first considering prearrangement before they are ready to complete an advance funeral plan. Funeral planning isn’t often top-of-mind for potential clients, even after learning that it is available. It’s very important to continue reinforcing the benefits of this valuable service.

Continuously evaluate whether your marketing efforts are effective at delivering your messages. Newer marketing channels, particularly social media and digital advertising, make it easier than ever to track your return on investment.

Pre-need Decision-making

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80%

60%

40%

20%

0%

19%14% 14%

27%

18%

8%

1-2 Weeks

2-4 Months

3-4 Weeks

5-12 Months

1-2 Years

More Than 2 Years

How much time passed between when you first thought about prearranging and

when you filled out the paperwork?

Reasons for TimingOne of the main reasons consumers prearrange is because of the recent death of a friend or family member. Consider ways to share the important benefits of advance funeral planning with loved ones who have attended services at your firm.

What Funeral Directors Say

When asked why consumers decide to make funeral plans now (instead of next year or last year, for instance), 38% mentioned reducing assets to qualify for benefits. Just 4% of policy owners identified asset reduction as their main motivator. The second most often mentioned motivator among funeral directors (26%) was a recent death of a friend or family member, which is cited as a top reason by policy owners.

Pre-need Decision-making

What was the main reason you decided to make these plans now?

0% 5% 10% 15% 20%

19%19%12%12%9%7%4%3%3%2%9%

Friend/family member recently died. Finally comfortable with the idea. Spouse wanted to do it. Finally reached the right age. Finally had money to do it. Finally knew arrangements I wanted. Needed to reduce my assets. Recently worked on estate planning. Mail or call urged me to do so.Recently prepared/updated my will.Other

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Importance of ReasonsPolicy owners say it was important to prearrange because they wanted to eliminate emotional and financial burdens from their families. When sharing the benefits of advance funeral planning, include relevant stories about how this gift can make a difficult time much easier for loved ones.

What Funeral Directors Say

Most funeral directors we surveyed also said eliminating emotional and financial burdens from children are the top reasons why consumers decide to prearrange. However, only 42% of funeral professionals said they think “fulfilling responsibility” is an “extremely important” motivator for people to prearrange, while consumers gave this much greater importance.

Pre-need Decision-making

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How important are the following to your decision to prearrange?

(Percentage of respondents

who rated these factors

as being “extremely

important.”)

0% 25% 50% 75% 100%

91%

90%

87%

83%

83%

81%

79%

79%

Eliminating emotional burden from kids.

Eliminating financial burden from kids.

Fulfilling my responsibility.

Eliminating spouse’s emotional burden.

Choosing arrangements I wanted.

Locking in today’s prices.

Making decisions with spouse.

Eliminating spouse’s financial burden.

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Number of Firms ConsideredMore than 70% of consumers considered only one funeral home when making their prearrangements. However, the percentage of pre-need policy owners who considered two or more funeral homes has increased significantly since we initially began tracking this information.

It is more important than ever to be top-of-mind in your community. Local market research can help you identify your position in the marketplace and gain important insights about demographics, attitudes and preferences.

Pre-need Decision-making

Including the one you selected, how many funeral

homes did you consider making arrangements with

before you chose one?

17%, Two

3%, Four or more7%, Three

73%, One

CremationMore than half of policy owners who chose cremation did so for reasons other than price. Over 50% of the respondents of a 2015 FAMIC study also indicated they chose cremation for reasons other than saving money.

What Funeral Directors Say

Most of the funeral directors we surveyed (62%) responded that consumers choose cremation for prearrangements because it is less expensive. While cost is the single largest reason policy owners indicated they chose cremation, it still accounts for less than half of the responses. As cremation becomes more prevalent, it can become a new tradition and an increasingly meaningful part of families’ needs.

Pre-need Decision-making

What is the main reason you selected cremation?

43% Less expensive.

19% Others in my family have been cremated.

17% Dislike idea of being buried in a casket.

9% Environmentally friendly.

6% Family lives far away.

1% More options for keepsakes/memorialization.

5% Other.

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Did you look on the internet for information on

prearranging before you made your plans?

92%No

8%Yes

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Online ResearchCurrently, most policy owners report that they did not conduct online research about prearranging prior to making their advance funeral plans. This is likely to change over time if internet usage continues to increase among people in the target age group. In addition to providing information for those researching pre-need, your online communications can help you build awareness of the benefits of pre-need in your community.

Pre-need Decision-making

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Experience and ReactionsYour client families’ satisfaction with their decision to prearrange has a lot to do with their experience with your firm. If client families feel that their questions were answered, that they had adequate time and information to make decisions and that prearranging gave them the opportunity to reflect on life in a positive way, they’ll be much more likely to feel confident about their decision to plan and fund their funeral.

We asked policy owners to tell us more about the prearrangement conference. This information can help you evaluate the experience you provide and meet the needs of everyone who may be involved.

Our survey results revealed that policy owners do experience high levels of satisfaction with their decision to prearrange. In fact, 96% of policy owners reported they are “completely” or “very” satisfied with their decision to make advance funeral plans.

Next Steps: Effective Marketing Tools

In addition to providing high levels of satisfaction, prearranging is a service many policy owners say they are likely to recommend to others. Homesteaders offers direct mail programs and social media resources that can help your funeral home stay in contact with the families you’ve served and reach new clients. Contact your Homesteaders account executive to learn more about these programs.

To see exclusive video content, visit: homesteaderslife.com/pnm-videos

Who Attended PrearrangementThe majority of those who prearrange are accompanied by someone when they make their arrangements. Men are most often joined by their spouse, while women are more likely to be alone or joined by their children.

Experience and Reactions

What Funeral Directors Say

We asked funeral directors to share how emotionally prepared families are for the at-need conversation when prearrangements exist. Most respondents (78%) perceive that families are at least “fairly well” prepared for the at-need conversation when prearrangements exist, compared to just 14% in situations where no prearrangements have been made.20

0% 25% 50%

47%

12%

4%

1%

7%

31%

Who accompanied you when you made your arrangements?

Spouse

Child/children

Friend

Parent(s)

Other family

No one

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Prearrangement LocationEight out of 10 policy owners made their arrangements at the funeral home. This is significantly higher than the 70% who reported making their arrangements at the funeral home in our 2008 survey.

The setting of the prearrangement conference can make a big difference in the family’s overall experience. If you’re meeting with a family at the funeral home, be sure to offer a tour of your facilities, show them merchandise options and explain the other services your firm provides (such as grief support resources).

Experience and Reactions

Where did you make your arrangements?

2%, Other18%My

Home

80%Funeral Home

Satisfaction with DecisionNearly all policy owners indicate they are completely or very satisfied with their decision to prearrange. For those who are unsure about deciding to prearrange, knowing that virtually no one regrets the decision can increase their confidence.

What Funeral Directors Say

When comparing the experience of making at-need arrangements, most funeral directors we surveyed (88%) said that having prearrangements in place made the process at least somewhat better than it would have been if no prearrangements existed, and a further 9% said it made the process neither better or worse. In addition, 89% of funeral directors said that families usually find the prearranged funeral selections “completely acceptable.”

Experience and Reactions

76%

20%

3%

0%

0%

How satisfied are you with your decision to

prearrange your funeral?

Completely

Very

Fairly well

Slightly

Not at all

0% 25% 50% 75% 100%

22

42%

14%

40%

4%

How likely are you to recommend prearranging

to someone else?

Have recommended

Plan to recommend

Would consider recommending

Probably won’t recommend

0% 25% 50% 75% 100%

Likelihood to RecommendOur study reveals that 96% of policy owners would at least consider recommending prearranging. More than 40% had already recommended prearrangement to someone within a few weeks of making their own arrangements.

What Funeral Directors Say

Nearly all funeral directors we surveyed (94%) said they feel consumers in their community are at least somewhat receptive to the idea of prearranging. By fostering relationships with families, funeral professionals can help share the benefits of advance funeral planning through valuable word-of-mouth referrals.

Experience and Reactions

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The most often-used pre-need funding company in America.*

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The results in this Pre-need Motivators report are based on responses from 1,095 Homesteaders policy owners who prearranged and prefunded during May 2017.

Other SourcesU.S. Census Bureau. 2010 Census Data. Retrieved from URL.

Pew Research Center (2018). Internet/Broadband Fact Sheet. Retrieved from URL.

Pew Research Center (2018). Social Media Use in 2018. Retrieved from URL.

Funeral and Memorial Information Council (2015). Study of American Attitudes Toward Ritualization and Memorialization.

Methodology

*According to a 2017 independent brand tracking study commissioned by Homesteaders and performed by McGuire Research.

The most often-used pre-need funding company in America.*

Trusted. Reliable. Secure.

For more than 112 years, Homesteaders Life Company has been trusted to make the right decisions about funeral funding products – decisions that are good for consumers and funeral professionals.

Homesteaders adopts a 360-degree view when designing our products, balancing security with profitability and designing tailored solutions that meet the diverse needs of policy owners, funeral homes and agents. As a result, our robust product portfolio offers reliable pre-need funding solutions that can meet the needs of any funeral business.

Above all, Homesteaders exists to pay claims. It’s a promise we make to consumers and our funeral home customers, and it influences nearly every business decision we make.

Our commitment to always doing the right thing is one of the many reasons we are the most often-used pre-need funding company in America.* Thousands of funeral professionals agree that Homesteaders is the trusted, reliable and secure choice for dependable pre-need funding.

To learn more, visit: homesteaderslife.com/commitment

Doing the Right Thing...

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Notes

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Notes

©2018 Homesteaders Life CompanyM1545-0418

5700 Westown ParkwayWest Des Moines, IA 50266homesteaderslife.com

Homesteaders Life Company is a national leader in providing products and services to promote and support the funding of advance funeral planning and end-of-life expenses. We have a commitment to marketing research and continually providing information to funeral professionals to help them improve profitability, grow market share and create remarkable experiences for people in the communities they serve.

Introducing the new 5th edition of Pre-need Motivators!

For more than a decade, funeral professionals across the country have relied on Homesteaders’ Pre-need Motivators report to learn about the real reasons behind consumers’ decision to prearrange. This completely updated edition has a brand new look, plus even more insights!

Read this exclusive report to discover:• Why consumers decide to make advance funeral plans• Consumers’ satisfaction with their decision to prearrange• Funeral directors’ perceptions about pre-need funeral planning• And much more!

Previous Edition

NEW EDITION