Millennials Are Ready for Insurance. Are You Ready for Them?
Despite the pandemic, I am a millennial on the move. I am just moving from one end of Chicago to the other, but I find myself in the market for renters insurance. I guess you can say that makes me the perfect case study. How will I choose who to purchase from? Where will I go? How will I buy?
MGAs and carriers should be pondering these questions daily, as millennials continue to age into their prime earning years. Millennials will soon be the largest buying group for both personal and commercial policies. And millennials won’t purchase all types of insurance the same way. For example, they may do their research online for simpler products but will require more personalized help for complex policies like BOP or package.
Why are millennials ready? And what can you do to open the doors of your business to millennials? MGAs and carriers should answer these questions for personal and commercial lines. We’ve discussed millennial buying habits in previous blog posts like this one and this one, but with even more millennials entering the workforce and approaching home-buying age, it’s worth another look.
Millennials Are Entering Their Prime
The pandemic has created uncertainty, but millennial homebuyers have not been fazed. Experts at Ellie Mae are tracking a boom in millennial home purchasing which they expect will accelerate through 2023. With millennials entering their prime earning years and interest rates at historic lows, millennials represented more closed purchase loans than any other generation in Q2 2020. And millennials with homes are millennials that need insurance.
Millennial homebuying is also a signal that millennials have established themselves in their careers. They have been promoted into decision-maker positions or have built small businesses that are thriving. That means millennials are likely to be the primary contact for sales of commercial policies. And what a massive opportunity, considering only 12% of millennials who own businesses have business insurance.
It’s Not Business as Usual
With millennials increasingly building equity with permanent homes and representing a great number of underinsured businesses, what are the best practices to capture a greater share of this generation’s wallet? Here are a few suggestions:
So, which insurer did I end up going with, and why? I booked with Lemonade through their online app. At the end of the day, my needs for insurance were not that great. The rental property landlord required it, so I needed an application process that was quick and simple.
What’s the lesson here for insurers that want to sell to my generation? If you don’t cater to our “what, where, and how”, you won’t be on our radar. Millennials have different needs and buying habits than previous generations. Invest in product innovation, technologies, and sales processes that fit the millennial worldview and you’ll stay relevant as the demographics shift.
Chris Mason is, by his own admission, a millennial as well as a Senior Marketing Associate for Instec. He has 5+ years of marketing experience and a unique view of the insurance marketplace as a recent graduate of Marquette University in 2012. He volunteers with the IASA, working as a Lead Producer for webinars put on by their eLearning Committee.