There’s no shortage of ideas, articles and stereotypes floating around about millennials. Millennials (born between 1981 and 1997) have been written off as lazy, entitled and bad with money – in spite of data proving otherwise.
There are several common misconceptions about millennials within the insurance industry, as well. But independent agents can’t afford to write off millennial consumers. Millennials are entering their peak earning years and now outnumber older generations. Millennial consumers will be the most influential market segment for the next few decades, so it’s critical that independent agents understand what millennial insurance consumers want in insurance.
Liberty Mutual and Safeco Insurance recently surveyed more than 2,800 insurance consumers (1,600 millennials) to discover generational differences in how customers view insurance and what they want from agents. Our new Agent for the Future™ report is full of insights to help IAs understand and attract millennial customers.
The research dispels a few common myths about millennial insurance consumers:
1: When purchasing insurance, millennials only care about price
There’s an assumption within the insurance world that when it comes to purchasing insurance, millennials consider price above all else.
However, our research found that price is a key purchasing factor for customers of all ages, and millennials are no more price-sensitive than older generations. When asked about their top considerations when purchasing insurance, 52 percent of millennials said they want the most comprehensive coverage for a good price. They also value understanding their coverage, a reputation for good service and an easy purchase process. Only 31 percent said they want the lowest price, even if it means a basic policy (compared with 29 percent of Gen-Xers and 18 percent of baby boomers).
2: Millennials don’t care about the details of their policy
Some insurance professionals assume that millennials don’t pay much attention to policy details. But in our survey, 53 percent of millennial respondents said they need to know all the details of their policy.
Millennials are more likely than baby boomers to say they constantly wonder about “what-if” scenarios. They want to know that they will be protected in the event of a disaster. And they want to be informed consumers – 80 percent of those who used agents said they want their agent to help them understand insurance. The topics they want the agent to help them understand include their coverage and how it works, what to expect in the event of a claim, and the unique features of their policy.
3: Millennials shop around for insurance online and are unlikely to stick with an agent
While Millennials are more likely than older generations to buy insurance online, more than half bought through an independent or exclusive agent.
In a focus group conducted by Liberty Mutual and Safeco consumer research, millennial respondents cited expert advice and plan comparisons as some of the reasons they chose to purchase through an IA.
“The person is informed on different plans and probably has more knowledge than I can find online, making my experience a lot easier,” said one millennial focus group participant.
Millennials who work with an agent report high levels of satisfaction, and 81 percent say they plan to use their current agent again in the future.
4: Millennials are city dwellers who have no plans to buy houses
Millennials have delayed major life events – such as getting married and buying a house – later than previous generations. But as older millennials reach their late 30s, more of them are starting families and making more complex purchasing decisions.
Our survey found that 45 percent of millennials currently own a house, and almost 80 percent plan to buy a house within the next 9 years. If independent agents can provide great advice and service for millennial customers with auto and renters policies, those customers will likely come back for home insurance in the future.
5: Millennials want to work with an agent who is their own age
Millennials aren’t too worried whether their agent looks or thinks like them. Only 9 percent want their agent to be close to their age. When asked what they look for in an agent, their top qualifications are someone who inspires trust (50 percent), is a seasoned insurance professional (49 percent), and makes a point to get to know them (29 percent).
When it comes to reaching millennial insurance consumers, it’s important for IAs to know fact from fiction and not make assumptions based on misconceptions.
In our new report on Agent for the Future, we explore more insights into how millennials purchase insurance and how IAs can attract and serve younger customers.
Have you ever asked yourself, "Why would you choose your agency?" Knowing your customer base and audience is key to answering this question and crafting an effective marketing strategy. If you focus on your strengths, brand message and personality should come easy from there. Check out 2019 Issue 4 of Smart Choice Magazine for more strategic tips and advice on marketing your agency for growth.