Are Your Insurance Campaigns on Meta No Longer Performing?
The Real Impact of the Special Ad Category in the U.S.
Since 2023, Meta (Facebook and Instagram) implemented a significant update to its ad policies that has directly impacted sensitive sectors like insurance. This update, known as the Special Ad Category, has changed the way businesses can configure, target, and optimize their campaigns on the platform.
In this article, we take a close look at how these new restrictions affect the insurance industry in the United States, and what strategies you can implement to adapt without losing competitiveness.
What is Meta’s Special Ad Category?
The Special Ad Category is a classification created by Meta to avoid discriminatory practices in sensitive areas such as:
- Employment
- Housing
- Credit
- Politics
- Financial products and services (including insurance)
You can review the official documentation directly in Meta’s Ads Help Center.
When an ad is marked under this category, automatic limitations are triggered on the campaign’s targeting and distribution options. While these policies aim to ensure fairness, they also represent a strategic challenge for businesses trying to reach specific audiences.
What Restrictions Affect Insurance Campaigns?
When selecting “financial products and services” as a special category, the following restrictions apply:
- You cannot target by age or gender. All ads are shown to people aged 18 to 65+, with no gender distinction.
- You cannot target by ZIP code or use narrow location radiuses. The minimum is 15 miles around a given point.
- You cannot exclude specific locations or use sensitive detailed interests (income, financial status, vehicle ownership, etc.).
- You cannot use lookalike audiences.
- You cannot activate automatic audience expansion.
- Stricter control over ad copy: absolute claims or guarantees are not allowed unless legally substantiated.
Impact on Key Metrics: CPL, CTR, ROAS
These restrictions have measurable consequences on campaign performance:
| Metric | Before (Traditional Targeting) | After (Special Category) |
|---|---|---|
| CPL (Cost per Lead) | $35 – $40 USD | $60 – $70 USD |
| CTR (Click-Through Rate) | 0.8% – 1.0% | 0.4% – 0.6% |
| ROAS (Return on Ad Spend) | ~3.0 | ~2.8 |
Source: Estimates based on aggregated data from specialized agencies and independent advertisers.
You can review additional benchmarks at WordStream.
Effects on Lead Quality
The impact is not just numeric. Without the ability to target by age, income, or property status, many campaigns end up reaching unqualified audiences:
- Users with no purchasing power
- Leads with no interest in the advertised product
- Higher abandonment rates on lead forms
This results in additional workload for sales teams, who must filter more contacts and face lower conversion rates.
Strategies to Successfully Adapt
At Budget Digital Solutions, we have guided our insurance sector clients through the transition to these new rules by implementing tactics such as:
1. First-Party Data Targeting
Upload lists of current clients, previous leads, or website visitors. Use custom audiences to enable effective retargeting.
2. Creatives that Attract the Right Audience
Content becomes your new “targeting tool.” Use clear messaging, testimonials, videos, and concrete benefits. Example: “Protect your business with a policy tailored to small companies.”
3. Smart Lead Forms
Include qualifying questions such as:
- Do you own a vehicle?
- Do you own a business?
- What type of coverage are you looking for?
This improves lead quality from the first interaction.
4. Optimized Landing Pages
Ensure that the post-click experience is clear, fast, and consistent with the ad. Including contact details, legal terms, and benefits helps build trust.
5. Channel Diversification
Complement your Meta efforts with:
- Google Ads to capture active demand
- LinkedIn Ads for commercial insurance targeting
- SEO content and blogs to position your brand long-term
Conclusion
Meta’s new rules represent a significant shift in insurance advertising. However, they also offer an opportunity to evolve toward more transparent, empathetic, and user-focused strategies.
If your campaigns are no longer generating the results they used to, at Budget Digital Solutions we can help you adapt intelligently—without sacrificing profitability or visibility.
Contact us today and turn this challenge into a competitive advantage.