As the largest generation in the American labor force, millennials are driving changes in every industry from retail to hospitality to insurance.
Businesses can’t rely on traditional marketing and sales tactics to connect with a generation that craves authenticity, transparency and mobility. Promoting flashy name brands to millennials is unlikely to convert a group of consumers saddled with financial debt and student loan payments. And for a generation growing increasingly dependent on their smartphone, snail mail catalogs and advertisements are quickly becoming quaint.
For industries such as insurance, understanding millennial behaviors can help carriers anticipate consumer expectations and improve the overall end user experience. Understanding what makes millennials ‘tick’ allows carriers to make adjustments to their service models in order to appeal to younger and younger insurance buyers.
Take millennials’ preference for renting over home ownership. In 2017, 76 percent of millennials felt renting was the more affordable housing option available to them; and this trend doesn’t appear to be reversing any time soon. The more millennials move around, the harder it is for carriers to keep tabs on their customers and claims payments could be sent to an outdated address. Other relevant documents and claims forms sent via postal service could go unread for days, resulting in unhappy customers and delaying payments received in the aftermath of an accident. In recognizing millennials’ tendency to move every couple of years, insurance carriers can identify and develop more reliable channels to communicate with their customers.
Smartphone dependency also influences how carriers should approach serving insurance to millennials. Twenty-something’s may be on the move, but the one thing they always remember to bring with them is their mobile device. Millennials spend approximately 223 minutes per day on their phones, doing everything from checking their email to paying bills to accessing their finances. Rather than trying to connect with consumers offline, insurance companies should consider more opportunities that make it easy for customers to manage their payment features on the go.
With a greater understanding of how millennials interact with brands and what devices they regularly use, carriers can begin to take the steps necessary to accommodate those consumer expectations. Partnering with insurtechs, or technology-centric companies within the insurance sector, can help traditional carriers make digital adjustments to their operational process in order to meet millennials where they shop. When carriers and insurtech organizations partner together, insurance companies can:
- Simplify and expedite the user experience. Millennials want things on-demand — in fact, 25 percent of young Americans expect a response from customer service within 10 minutes of reaching out. Instead of sticking to the old way of servicing customers, insurance carriers can work with insurtech companies to accelerate the claims process to meet millennials’ expectations. Insurtechs can also help carriers make adjustments simpler by reducing cycle time, and empowering customers to virtually settle claims.
- Provide consistent, constant engagement. When millennials are fully engaged with their carriers, they are more likely to remain a long-time customer of that insurer. One way insurers can strengthen and improve customer engagement is to offer a great end-user experience. Working together with insurtech organizations, carriers can provide the speed and convenience millennials expect from digital insurance tools and keep customers happy throughout their insurance experience.
- Deliver on-demand reimbursement payments. Another challenge insurers face is determining the accuracy of an insured’s home address when it comes time to mail reimbursement checks. Millennials who forget to update their new apartment information risk having carriers send claims payments to the wrong address, delaying the process further for everyone involved. Working with insurtechs, carriers can digitize their reimbursement processes to consistently deliver checks to millennial customers in a timely manner.
As millennials increasingly enter the insurance marketplace, carriers will need to adjust their business models to meet the expectations of a younger, more tech-savvy generation. By getting to know consumers’ needs and wants, insurance providers can begin implementing solutions that appeal to the millennial buyer.