The purchasing habits of millennials are difficult to figure out, and as the largest generation in the U.S., your insurance business’ future depends on your ability to reach them.
Revealed in a recent study commissioned by Effective Coverage and performed by ORC International, what we do know about millennials is that they aren’t likely to purchase home and renters insurance from local agencies. In fact, 18-29-year-olds are 50% less likely than their parents to purchase from local representatives. Of all the groups surveyed, millennial renters were the least likely to purchase policies from individual agents. Forty percent of all age groups surveyed purchased home insurance policies from local insurance agencies, yet only 24% of millennials followed suit.
Instead of working with local agents to find the right coverage, 67% of millennials are purchasing directly from insurance companies, leaving agents out of the picture. Before trying to win them over, we need to understand why local insurance professionals aren’t reaching this important demographic.
1. Millennials want immediacy - Millennials are the on-demand generation and they don’t remember life before the Internet, nor do they want to. Clothing, television shows, and even dating are just a couple of clicks away. The convenience of doing everything from the comfort of their living rooms has developed into a way of life. Unless the benefits of doing things differently are evident, there aren’t many occasions that will entice millennials to trade an instant shopping experience for the time-consuming task of driving somewhere and “dealing” with actual people. If a millennial is looking for a new pair of shoes or even insurance coverage at midnight, there are only two places to go: the Internet or the call center of a direct writer.
How to overcome: You can’t keep your office open 24 hours, but you may be able to provide extended hours, conduct meetings that are convenient for them (try local coffee shops), and utilize online tools and resources to reach them. At Effective Coverage, we recently filmed over 100 videos answering questions about renters insurance. Why? Because when millennials have questions, they want answers immediately. Answering those questions on their terms is a good start to building a relationship and eventually offering them insurance products.
2. Millennials are hard to find -Millennials are elusive and don’t often travel in packs. They don’t ask their friends or peers for referrals. They go online to social media and review sites to learn about products and to get a feel for a brand. If they’re comfortable with products or services after doing research, they’ll purchase immediately from where they currently are—online.
How to overcome: Create online and social media profiles so millennials can find you. From advertising on social media, to providing your customers with easy ways to share information online with their networks, if you use technology to reach millennials, you’ll be a couple of steps closer to landing new policyholders in this demographic.
(Photo: Shutterstock.com)
3. They have their own communication style - Millennials don’t want to spend extra time speaking to someone in person or over the phone to complete a transaction. They want to send a text or press submit, and then receive receipts sent directly to their inboxes in case they ever need proofs of purchase. Upselling makes them uncomfortable, and they don’t see any benefit to sitting in offices for an hour filling out paperwork.
How to overcome: Every good insurance advisor approaches each prospect differently to cater to their needs and preferences. The easier you can make their decisions while keeping the pressure low and giving them access to information—the better off you are. Even if your standard sales pitch is 20 minutes, create a five-minute version. If you’re required to upsell every customer, find a low-pressure way to present potential options to younger clients that won’t have them running for the exits.
4. Millennials don’t like outdated and poorly designed websites - Have you ever seen a commercial or billboard that just doesn’t speak to you? Millennials have learned to trust well-designed and easy-to-understand ads and websites. Just look at the rise in popularity of infographics. An outdated website is like a lighted restaurant sign with half of the light bulbs burnt out.
How to overcome: Update your website’s text and design. If it is in the budget, hire a creative agency or freelancer that specializes in targeting the younger generation to create marketing materials and help overhaul your website. Remember: if your website doesn’t look good, you won’t gain their trust.
5. They aren’t mobile-ready - You’ll be hard-pressed to find a millennial who doesn’t own a smartphone. In fact, more than 85% of millennials own one, and one in five millennials access the Internet solely from mobile devices. If your website isn’t mobile-ready, you’re killing your chances of reaching the millennials. And it’s not just millennials who want your website to be compatible on their smartphones. Google does too.
How to overcome: Ensure your website is mobile-friendly. You don’t need to change your entire brand, but you need to offer potential customers the ability to access your site from both their computers and mobile devices.
Times are changing, and in order to reach the next generation of insurance customers, you have to update your practices. By dedicating more of your efforts to cater to millennials, you can increase revenues and grow significantly as this generation ages.
Eric Narcisco is the CEO of Effective Coverage, a national online renter's insurance provider. Narcisco suffered an apartment fire while uninsured—which sparked his dedication to helping renters get covered.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
