At Liberty Mutual Insurance and Safeco Insurance, we often say the value proposition of independent insurance agents (IAs) boils down to their unique ability to offer customers the ease, choice and advice they need to make wise insurance decisions. Independent agents make it easy for customers to find the most comprehensive coverage for a good price. They give customers choices from many different carriers and provide expert advice on risks, policy options and more.
The insurance industry is in a time of unprecedented momentum and innovation, but I still firmly believe that independent agents are the best advocates consumers have as they seek coverage for the things they care most about.
However, a survey by Liberty Mutual Insurance and Safeco Insurance found that many consumers – especially younger consumers – do not fully understand the value of independent agents.
70 percent of the millennials surveyed thought they could replicate what their agent did for them on their own.
79 percent of millennials took independent actions while working with an independent agent – such as researching insurance companies, agents or insurance terminology.
These stats show that IAs need to help millennial consumers see past “cheap and easy” options. Our latest Agent for the Future™ research report provides insights into how agents can demonstrate their value to win millennial customers. This is the last of three Agent for the Future reports providing research-driven strategies for how agents can more effectively attract and retain millennial customers.
The findings in each report have shown that millennials want what agents have to offer. But the methods of providing ease, choice and advice are evolving. Independent agents have more ways than ever before to deliver on these value propositions, but they must adapt to changing customer expectations to win with future generations of customers.
Ease – creating simple, frictionless customer experiences
According to our research, millennials are more likely than older generations to learn about and choose agents online. In fact, 79 percent of millennials who don’t work with an agent said they could foresee themselves learning about an agent through digital engagement such as online search, review sites and social media.
Millennials are also more likely to turn to digital channels when looking for service on their policy. 96 percent of millennials used at least one digital channel for service and 50 percent used four or more.
Consumers now expect their agents to have a digital footprint and be available 24/7. “Ease of doing business” no longer simply means the behind-the-scenes work agents do on behalf of a consumer. It also means making yourself more visible online and more accessible through multiple channels.
Choice – giving customers options
It’s easier than ever before for insurance shoppers to do their own research and quickly obtain insurance quotes online. Our research found that nearly 1 in 5 insurance shoppers of all ages got their own quotes separately even when they were working with an agent.
The ease of comparison shopping online may play into the fact that 7 in 10 millennials we surveyed thought they could replicate what an agent did for them on their own.
However, 55 percent of millennials said that while they thought they could replicate their agent’s work, they prefer not to do so. After all, comparison shopping is time-consuming, especially for younger consumers who are less familiar with insurance and unsure how to determine what kind of coverage they need.
Our research also found that millennials are no more price-conscious than older generations. Their top consideration when purchasing insurance is getting the most comprehensive coverage for a good price.
IAs’ ability to offer “choice” must be more than selling on price. Instead, IAs can help customers get a full view of their risk profile, then offer them a breadth of comprehensive coverage options – saving customers time and providing clarity.
Here, again, digital tools can help agents provide value over the long run. Independent agents who have a deep understanding of their customers can use technology to deepen their connections with customers and prospects.
Advice – educating customers
According to our research, 38 percent of millennials say they constantly worry about “what-if” scenarios, compared with only 12 percent of baby boomers.
The same percentage of millennials say they know nothing about insurance. And they want guidance – 80 percent say they want their agent to help them understand insurance. They want their agent to explain their coverage and how it works, what to expect if they have a claim, the features of their policy, and more.
This shows that millennials desire the expert advice that agents offer. Agents can help millennial customers make informed decisions about insurance coverage that will make them feel secure and protected.
Strategic advice should be part of every step of the client journey. For example, since millennials are likely to research online while making insurance decisions, agents should establish themselves as experts online. When presenting policy options, agents should talk clients through how they arrived at the suggestions, explaining the coverage in detail.
Showing expertise can help agents show their value to customers and build trusting, long-lasting relationships.
Putting agents first
As I look ahead to the rest of 2020 and beyond, I’ve never been more excited about the work we at Liberty Mutual and Safeco get to do together with independent agents. We sincerely believe that independent agents will continue to win in the marketplace, and we’re dedicated to providing products and services that help them do it.
The research and insights on Agent for the Future are part of our commitment to work together with independent agents for the continued growth of the IA channel. We hope you’ll continue to join the conversation and share your ideas with us. To stay up to date on our latest research, agent stories and industry insights, Sign up for our email newsletter below, email firstname.lastname@example.org, or follow us on Twitter and Instagram.
Good article Tyler! We need to always remember that Millennials and Gen Z are the future of our agencies. They are the generations that will marry, start families, acquire homes and other assets which brings the need for more comprehensive insurance and solid advice. These generations are definitely data driven. Agents need to focus on ways to drive these generations to our agencies and give them a fast and easy digital experience, then find a way to build a solid trusting relationship. We cannot afford to overlook these generations that will help us to continue to thrive. If we don’t… Read more »