When our teams at Liberty Mutual and Safeco Insurance talk to independent insurance agents, some of the most common questions we hear are about millennial insurance consumers.
Questions such as: “What do millennials want from us?” and “How do we market to younger insurance customers and keep from losing them to direct-to-consumer carriers?”
These are important questions. In our original Agent for the Future™ survey, 55 percent of agents said the rise of the millennial consumer segment would have a major effect on their agency by 2020. Millennials (those born between 1981 and 1997) are now the largest generation of adults in the U.S., numbering more than 73 million, according to Pew Research Center. They are entering their peak earning years, starting families, buying houses and making more complex purchases.
Millennial consumers will be the most influential market segment for the next few decades. Any business that wants to survive must learn how to attract and keep millennial customers.
At Liberty Mutual and Safeco, we believe independent insurance agents will win with consumers of any generation. We want to offer practical advice and insights to help agents succeed and better understand and serve their customers. So we set out to help answer some of those questions we’re hearing from agents.
In March 2019, our research team conducted a survey among 2,860 consumers throughout the United States – roughly 1,600 millennials, 600 Gen-Xers and 600 baby boomers. The survey covered topics such as how consumers view insurance and agents, the key factors they consider when purchasing insurance, what they look for in an agent, and more.
You can read the first full report on our findings here. Here are a few of the main things we found:
Millennials don’t just care about price
There’s a popular notion in the insurance industry that millennials care about price above all other buying factors. Our research found that this is not the case! While members of every generation listed price as one of the key factors when purchasing insurance, millennials were no more price-sensitive than Gen-Xers or baby boomers.
In fact, millennials and older generations have similar priorities when looking for insurance. When it comes to purchasing insurance, 52 percent of millennials want the most comprehensive coverage for a good price. Half want to understand the coverage, and 49 percent want a reputation for good service. Only 31 percent want the lowest price even if it means a basic policy (compared with 29 percent of Gen-Xers and 18 percent of baby boomers).
Millennials are more likely than older generations to find an agent through digital engagement
Younger consumers still appreciate the human touch. While millennials are more likely than older generations to buy insurance online, the majority of them still purchase through exclusive or independent agents. 52 percent of millennials bought auto insurance through an agent, and 58 percent bought home insurance through an agent.
However, millennials are more likely to learn about agents and choose an agent through digital channels such as online reviews, online search and social media. Our survey found that more than one in four millennials said they learned about an agent through digital engagement, compared with 18 percent of Gen-Xers and 12 percent of baby boomers.
When it came to choosing one agent over another, millennials were more likely than older generations to look at an agent’s digital presence. 43 percent of millennials looked for positive online reviews, 28 percent considered social media engagement, and 24 percent looked for a modern website.
These findings highlight the importance of encouraging online reviews from happy clients and responding politely to any critical reviews. Agents may also consider working with search engine optimization (SEO) experts to keep the agency’s website visible.
Millennials want you to help them become informed consumers
Interestingly, millennials are three times as likely as baby boomers to say that they constantly worry about what-if scenarios. They want to know all the details of their policy and understand how it will protect them in a worst-case scenario. You can put their fears to rest by showing them how you can deliver the right coverage.
Our survey found that millennials recognize that they have a lot to learn about insurance. They desire to be informed consumers, and they want their agent to help educate them. Of those who worked with agents, 80 percent said they want their agent to help them understand insurance. Their top priorities of things to talk through include how their coverage works, what to expect if they have a claim, the unique features of their policy, and how to manage their policy online.
Good news for independent agents
Millennials who use agents report high levels of satisfaction. 83 percent said they trust their agent, and 81 percent said they plan to use their current agent again.
This shows that if agents can demonstrate their unique value to attract millennial consumers, millennial clients are likely to stick around as their needs change and grow.