Insurance Brands Love Funny Ads, But Laughter Fades Fast
The insurance industry has hit a saturation point. Of the five largest U.S. agencies, four are known for using humor in their marketing. 1 A tonal shift in messaging is due any day now. What brands will come out on top? The ones who keep it real.
Have you noticed that there’s something funny about insurance ads these days? I’m not talking about misleading messaging. From one-off blockbuster Super Bowl ads to everyday spots on CNN, top brands like Progressive, Liberty Mutual, and State Farm rely on humor to win over audiences.
These ads cost millions. So, they must work—right? On some level, they absolutely do. There is no doubt that those lighthearted jokes and catchy jingles stick with audiences of all ages. Brand awareness and recall are through the roof for these companies.
According to an analysis of over 200,000 brand campaigns, the use of humor in advertising fell off a cliff in 2008. Now, just 34% of all ads have a funny or lighthearted tone—unless you’re talking about insurance.2
GEICO didn’t just break the mold with their Gecko in 1999. They created a new one that’s set a quarter-century-long standard for insurance branding. Of the five top U.S. insurance agencies, four consistently use humor in their marketing campaigns.3
With the successes of humor-heavy campaigns, insurance companies could easily think this is the ideal, and only, way to attract consumers. Nothing could be further from the truth. In some ways, this tactic comes with risks. Relying too much on punchlines and puns can make an agency seem like everyone else in the market. Humor can also be a diversionary tactic. Keep you from focussing on deeper, more substantive issues – and the insurance industry has plenty of those! There are different ways for insurance companies to stand out from the noise, build trust, make a difference, and even save money down the road.
The Messaging vs. Reality Gap is No Joke
Despite all the laughs we see in commercials, insurance is serious business. A successfully run insurance company relies on incredible brainpower. They need financial engineers to read trends found in everything from disease and weather patterns to Supreme Court rulings. Their ability to do so allows the agency to accurately predict and price product offerings.
Throughout my career, I’ve been lucky enough to work with a lot of these incredible minds. Without their talent, any firm would go bankrupt overnight. They are amazing people.
But trust me, humor is not their forte.
The lighthearted campaigns you see aim to humanize an industry that is often unfairly considered callous and inhuman. Here, humor is a mechanism to get people to knock on the front door for a quote. If you’ve ever needed to open that door, however, you know all the fun dries up immediately. There’s no joy in buying insurance, and it’s even worse when you need to use it. Going through the claims process is frustrating, time consuming, and confusing.
When I was CMO of Cigna several years ago, we were conducting some focus groups. A woman in that group nailed it when she said, “When I need you the most, I am at my worst. Therefore, you need to be at your best.”
That quote has stuck with me ever since. To me, it’s a reminder that while humor might be good at establishing awareness, it doesn’t build lasting trust. Recent, in-depth consumer research points to this exact issue.
A study investigating 8,500 consumers and their insurance purchasing behaviors over a five-year period shows that CX is the ultimate barometer for brand loyalty and revenue growth. Through virtually every point of analysis, this investigation kept coming back to one, core idea:
People might like a laugh, but they love to feel valued. Insurance brands with the strongest CX strategies outperform their peers in total shareholder return (TSR) by up to 65 points.4
What does this mean for brand awareness? You don’t need to poach the entire staff of SNL to get people to unite around your brand. The significant gaps between the easygoing tone of brand awareness messaging and the realities of insurance point to a huge opportunity. Instead of ignoring this gap from the start, companies could address these shortcomings directly.
Building Awareness Beyond the :30s Spot
Traditional brand awareness advertising is just one way to get consumers to pay attention. There are countless ways to turn heads these days. This isn’t just about posting on social media. Those platforms can be great places to leverage important conversations instead of simply selling insurance plans. For this sector, however, there are only so many ways to promote your agency on social media without looking like a Tik-Toktail party crasher.
In fact, maybe the answer is to avoid overtly pushing insurance. It’s possible to go the subtle route and integrate yourself into where the real-life excitement is already happening. Supporting and investing in community connections takes time, but it’s worth it. Instead of interrupting the fun, you add to it.
Here are a few ways insurance companies can be entertaining, do some good, and build lasting trust:
During my time at three different insurers in three different insurance categories, I was struck by the amount of information that was at my fingertips, especially when it comes to various risks. In health insurance, one that stuck out to me was the health disparities existing within various socioeconomic and cultural groups.
While internal teams talked about these issues a lot, we never actually took the steps to address these challenges. A key reason for those health disparities centered around limited access to affordable, nutritious food. We kept our thinking at an intellectual level, not a street level. When it comes to eating, however, it happens at a street level. We all love food, food trucks, and party atmospheres.
Poor diets cost the U.S. healthcare system $50 billion every year.5 What’s stopping health insurance brands from slashing that price tag through feel-good initiatives?
An insurer could easily hire chefs from various communities to create nutritious recipes, stock up a food truck and hit all the neighborhoods that could benefit. They could do it in a way that is fun, funny, and meaningful. Classes could be offered where people learn how to cook healthier. These initiatives would do more than strengthen brand awareness and build trust. They would also help address major health issues that impact their customers’ well-being, and therefore an insurance company’s bottom line.
What else do people like to do? Oh yeah, they like to drink coffee. Unfortunately, too much is consumed at the drive-through, which auto insurers see as a risk for car accidents.
We just don’t have time to relax. That’s why Starbucks built its whole brand around people’s innate desire to find a welcoming, third place between home and work where they could unwind. Insurers could use this thinking to their advantage.
An insurer in any category could open up a pop-up café. Or better yet, they could partner with a trusted coffee brand to convert some storefronts into sponsored community centers. These places could also double as a customer service hub. By the way, Starbucks has some real challenges right now. I bet they would be open to finding some innovative ways to improve the usage of their facilities.
I don’t mean to make this sound easier than it is. It requires a lot of analysis and strategizing. And of course, the genius is in the details. But the point is that there are ways to meet your customers where they are, on their terms, and demonstrate how you value their ability to enjoy their lives. And if you do that? Well maybe, just maybe, they will value your ability to protect their lives.
Guest post by Ed Faruolo Ed Faruolo helps lead strategic development for Prager Creative. He has also run his own business consulting firm serving clients and conducting workshops throughout the United States. He served as Chief Marketing Officer for Cigna Corporation and also led marketing for The Travelers and Lincoln Financial. He currently is Vice Chair of the Board of Directors for Elevate New England, a non profit that provides a unique mentoring program for urban youth.
Sources: (1.) SP Global, 2023 (2.) Marketing Week, 2022 (3.) New York Times, 2017 (4.) McKinsey, 2023 (5.) Harvard T.H. Chan School of Public Health, 2020
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