As they buy homes and start families, millennials are finally beginning to show interest in purchasing insurance. Here’s how carriers can sell to this generation.
A new poll suggests millennials no longer view insurance as an abstract concept relevant only in some distant future. As this 80-million strong cohort — the largest living generation in the US — matures, buys homes, starts families, and even contemplates retirement, the need to purchase insurance gradually becomes more urgent.
In the Harris Poll’s 29th annual EquiTrend Study, which measures consumer affinity for certain brands based on familiarity, quality, and purchase consideration, millennials tagged insurance brands with an equity rating of 60 compared to 55 among all consumers. Millennials declared a particularly strong emotional connection to life, property, and casualty insurance companies relative to Baby Boomer and Generation X consumers.
For agents, the sheer number of millennials and their newfound attraction to insurance represents an enormous business opportunity — if you design sales tactics that specifically target this new audience, that is. Here’s what insurance agents need to know about this often misunderstood generation.
They’re Two Generations in One
Born between 1982 and 2000, millennials span the ages of 17 to 35. That’s a pretty wide range, so selling to millennials as if they are one monolithic group is a strategy that’s bound to fail. Focus on older millennials looking for insurance protection as they begin to purchase homes and start families — targeting this segment for home and life insurance provides the best leads.
They’re More Interested in Experiences Than Products
Although many older millennials may be buying homes, others aren’t in home ownership. Having come of age during the crash of the housing market, they prefer the flexibility of renting and the ability to have experiences through travel and moving. They’re more likely to rent than buy, and prefer to “share” material goods, as evidenced by the rise of sharing economy companies like Uber and Airbnb. It’s up to agents to convince these consumers that products like renters insurance can preserve their lifestyle, even if they don’t own assets.
They’re Already Thinking About Retirement
A 2015 Vanguard study indicated millennial participation in workplace 401(K) plans increased between 2003 and 2013. Automatic enrollment largely drove this upswing, with 87% of millennials participating in automatic enrollment Vanguard plans. Ten years earlier, the percentage stood at 70%. Though decades away from retirement, millennials are nevertheless beginning to think about how to fund their golden years. Retirement savings products like annuities fit with this mindset.
They’re Digital Natives
If there’s one cliche about millennials that really does hold true, it’s that they’re digital natives. They grew up surrounded by technology, so it’s hardly surprising that 74% of millennials told Nielsen that “technology use” is a major factor in what makes their generation unique. The obvious lesson to be drawn for insurance carriers is to up their web-based lead generation efforts. To stand out to this tech-savvy generation, insurance agents should consider developing apps that allow millennials to sign up and file claims, as have several insurtech startups like Lemonade. The point is to reach millennials where they live, which is most often on their smartphones and mobile devices.
They’re a Frugal Bunch
Laden with college debt, millennials rigorously shop for the best price — and that includes insurance premiums. Products combining value for their dollars and technology will definitely pique their interest. Many auto insurers offer data-monitoring telematic devices that give discounts to safe drivers or set rates based on usage. If there were ever an insurance product matching millennials it’s that one.
Finally, a previously underinsured generation has begun to think seriously about insurance. Take note, insurance agents, and start selling.