Four ways insurance agents can increase the percentage of millennials who own renters insurance.
As millennials graduate college and start their careers, they overwhelmingly rent their first homes. According to Pew Research, 65% of people under the age of 35 rented their homes as of 2016, while 41% of households headed by someone between the ages of 35 and 44 were also renters. Those percentages have increased dramatically since 2008, when 57% of people younger than 35 and 31% of people between 35 and 44 rented.
A 2016 survey by InsuranceQuotes.com and Princeton Survey Research Associates International (PSRAI) uncovered similar results. After polling some 1,000 adults, researchers found that 66% of those between 18 and 29 rent their homes.
Given those numbers, insurance agents may assume that renters insurance is an easy sell to most Millennials. That same InsuranceQuotes.com survey, however, revealed that only a third of millennial renters own renters insurance.
What’s holding them back? Surprisingly, 59% of respondents said that cost isn’t a major factor. Indeed, more than 60% said that they forgo a policy because they believe they live in a secure place, while 43% replied they don’t have enough personal property worth insuring. More alarmingly, 41% said that they don’t purchase renters insurance simply because they don’t understand it.
With so many misconceptions surrounding renters insurance, it’s up to insurance agents to dispel these misunderstandings and encourage millennials to purchase this essential product. Here are four tips that any agent can follow to market renters insurance to this largely untapped audience.
Detail What the Policy Covers
While they may not think otherwise, millennials tend to own many valuable items such as computers, televisions, and appliances that would be extremely expensive to replace in the event of a fire or theft. Accordingly, insurance agents should emphasize how an affordable renters insurance policy reimburses policyholders for their personal possessions, sparing them the need to dip into their personal savings when purchasing replacements.
Renters insurance covers more than personal property, however. A policy also includes liability coverage in case a visitor is injured on the property, which frees the renter from having to foot any costly medical bills. Should a renter be displaced from his or her home due to a fire or other catastrophe, renters insurance also pays for temporary housing.
Stress That It’s Affordable
Although a majority of Millennials told the InsuranceQuotes.com and PSRAI researchers that cost wasn’t a deterrent to buying renters insurance, they also estimated that the average policy costs $1,000 a year. In fact, the cost is much lower than that — between $180 to $360 per year, according to the National Association of Insurance Commissioners. For just $20 more a year, Millennials can further boost their liability coverage limits from $100,000 to $500,000.
Tech-savvy Millennials increasingly prefer to research and buy insurance coverage online, and both insurtech startups and established insurers are catering to those wishes. BungalowInsurance.com’s website was specifically designed to push Millennials to buy renters insurance — they simply input their zip code online and then choose a local policy. Similarly, Nationwide has developed a mobile app for renters insurance. Insurance agents looking to attract millennial clients should imitate those methods by digitizing as much of the sales process as possible.
Be There When They Reach Out
As the InsuranceQuotes.com and PSRAI survey indicates, millennials have a lot of questions about renters insurance and how it works. Even though they may research products online, millennials still seek out a professional when purchasing an important product like renters insurance. As simple as it sounds, Insurance agents provide the personalized interaction and advice a chatbot cannot.
While many of them may not know it, renters insurance is a product that many Millennials need at this time in their lives. Insurance agents can play a vital role in helping them insure their vital assets while they rent their homes.