Why Financial Institutions Enjoy a Trust Advantage for Insurance
Trust Is the New Currency in Financial Services
Consumers have more financial choices than ever, and they’re increasingly looking to consolidate those relationships with institutions they already know and trust. For many, that means turning to their primary financial institution not just for banking services, but for protection products as well.
Banks and credit unions continue to rank among the most trusted institutions consumers interact with regularly, according to long-running trust studies from organizations like Edelman. The 2025 Edelman Trust Barometer showed that global trust in banks reached 64%, placing the sector in the “trusted” category in 17 out of 28 countries surveyed. The same survey showed 68% trust in banks versus a 61-63% trust for various insurance types.
That trust gap is not theoretical. It shapes where consumers turn when financial decisions feel uncertain—and it explains why financial institutions are uniquely positioned to lead conversations about protection, not just growth.
The Relationship Advantage Financial Institutions Hold
Trust is no longer a soft brand metric. It directly affects behavior. When consumers lack confidence, they delay decisions, underinsure, or avoid planning altogether. Financial institutions often have an advantage because they are already embedded in daily financial life—checking balances, paying bills, saving, borrowing, and planning. That ongoing presence builds familiarity, and familiarity builds trust.
Research consistently finds that consumers are more likely to seek advice, accept recommendations, and remain loyal when they believe an institution understands their broader financial life—not just a single product need. The J.D. Power 2025 U.S. Retail Banking Satisfaction Study reinforces this by showing that banks’ focus on personalized, engaged relationships has improved loyalty metrics: the likelihood of not switching rose 2 percentage points, reuse intent increased 3 points, and sentiment that the bank “completely supports me in challenging times” climbed 4 points year-over-year.
Why This Matters Now
Consumers are carrying more financial responsibility and anxiety. Higher deductibles, out-of-pocket costs, and coverage confusion mean protection decisions matter more than ever. Medical expenses remain a leading contributor to financial distress, highlighting the gap between “having insurance” and being financially protected.
In this environment, consumers want clarity and confidence—qualities they already associate with their financial institutions. When consumers expect human support for complicated decisions, even digital-first users want the option of a conversation or reassurance. When protection is introduced through a trusted institution, it often feels less like a sale and more like help.
A Clear Opportunity for Financial Institutions
When insurance is offered through a trusted institution, consumers interpret it differently. It feels integrated into a broader financial wellness plan rather than a stand-alone decision made in a confusing marketplace. Embedded and integrated protection models reflect how consumers actually live: fewer handoffs, less friction, more relevance.
A 2024 study revealed that 75% of consumers view purchasing a vehicle and insurance together as more convenient, while 81% want the option to buy auto insurance directly at the point of vehicle purchase—potentially unlocking new revenue while enhancing loyalty through trusted, one-stop solutions.
The Bottom Line
Trust is not just a reputation—it’s an asset. Financial institutions already hold it, and that trust shapes where consumers turn when decisions feel complex. Consumers don’t separate insurance from financial life. They experience everything as one system. Institutions that help strengthen protection support the entire financial wellness journey, especially the ability to keep saving, paying, and planning when life takes a turn.
At Franklin Madison, we help financial institutions extend their trusted role into protection, delivering insurance solutions that align with financial wellness goals, integrate seamlessly into digital experiences, and help consumers feel confident through every life stage.
