How Insurance companies can attract more Millenials
Last year saw a significant demographic shift in the USAs millennials (those born between 1981 and 1997) overtook baby boomers, becoming the largest generation of adults in America. With similar changes taking place in Europe and Asia, and as older millennials head into their peak owning years, insurance companies must attract them if they want to survive.
Looking at the statistics, you’d assume that millennials don’t value insurance. Only 10% of U.S. millennials have enough life insurance to cover their families’ needs, while only 9% have any form of income protection. However, when looking at other areas, it’s clear that millennials do value insurance and are more likely to take out travel insurance and contents insurance than older generations.
Additionally, there are many reasons for insurance companies to be excited about this market. They’re not as price-focused as previous generations, valuing quality service, and clear policies over cost. So how can insurance companies capture this market?
Make sure you’re online.
Building a strong online presence should be obvious, but it still needs to be said. The insurance industry has struggled to attract young talent, which makes it harder for the industry to understand millennials as customers. Where insurance companies have made the switch, the results are clear. In the USA, 90 percent of customers buy travel insurance online, while only six percent get their home insurance in the same way.
Make sure the benefits are clear.
A 2019 study from Legal & General into millennials’ views on life insurance found that many young people had misconceptions about life insurance. 36% of millennials without insurance know that their partner wouldn’t be able to afford mortgage payments in the event of their death, but 44% didn’t realize a life insurance payout can cover a mortgage. Many Millenials felt insurance costs were too high. Yet, 90% of millennials overestimated the average price of a policy. It’s not surprising that millennials aren’t purchasing insurance when they aren’t sure of either the cost or the benefits.
Offer suitable and customized policies.
For various reasons, including requiring a higher level of education, more student debt, and less stable employment than previous generations, millennials are putting off significant life events. They are buying houses later, getting married later and having fewer children. Insurance agents should make sure their policies reflect this. A couple renting won’t need home insurance, but they may want contents insurance. A single man looking for income protection insurance won’t be swayed by adverts offering protection for dependents he doesn’t have. Still, a product personalized to his situation will undoubtedly catch his eye.
Don’t use statistics, tell stories.
Sharing statistics, whether on the number of people that will need time off work for an accident or the number of people who are injured at work, may convince some people to get life insurance. Yet, Millennials are far more likely to connect with personal stories. Most millennials have known at least one person who’s needed an extended break from work due to injury. Highlighting the story of an individual will be more effective than hard data when connecting with most millennials. Life insurance company tom.co.uk has raised its profile by having individuals share their stories through social media.
Many industries such as retail and entertainment have adapted, reflecting the changing demographics as the tech-savvy Millennial generation has become the most significant market, while the insurance industry is changing slowly, change is coming.
Embrace Technology, to give your customers a unique product.
Insurtech partnerships are on the rise, and for good reason. With millennials demanding personalization, and products that fit their needs. Insurance companies recognize this need but are slow to adapt. 68% of insurers feel partnerships are critical, but just 32% are actively collaborating.
Through our partnerships with automobile associations and insurance companies, VouchForMe’s social proof model has given insurers the tools needed to attract low-risk younger drivers, while offering them a product that helps them stand out from the crowd.
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