Selling Life Insurance to Millennials
Welcome to the first in a five-part series on selling life insurance to millennials.
One of the bigger issues that life insurance providers face is how to distribute their products to a younger, more tech-savvy generation. Essentially, how does one sell to a millennial? Or more importantly, how does a millennial consume, research and purchase? In most discussions or articles about that generation, you will find them spoken about as if they’re some mystifying collection of individuals who shop in weird and random ways that marketers can’t quite wrap their heads around. However, that isn’t really true. Not only is it fairly easy for life insurance providers to reach them it’s also pretty important that they do.
The reasons are complex, but the result is the same for insurance companies. We all know how risk pools work, and that the population of those who own life insurance is aging. Insurance companies with aging risk pools who don’t bring in younger clients will soon find themselves facing unfavourable current and future cash flow positions.
One survey found that only 36% of millennials have life insurance, compared to 60% of those in the next age range. On one level this makes sense, given that they’re delaying life events such as marriage, home ownership and having children. But, while there’s a tendency to view millennials as still in their 20’s, the oldest millennial is now 37 years old. They’re at an age where they need and should be buying, life insurance. Yet, they’re not. If the insurance industry is to thrive, it has to reach and appeal to this modern set of consumers. Which means learning how the generation shops and how to appeal to them.
Millennial shoppers prize the ease and convenience of shopping online and are more willing than most to purchase big-ticket items on the internet. They’ll buy engagement rings, cars, and even homes online, sometimes sight unseen.
The millennial shopper also does thorough research before making a purchase. There’s an expectation that they can educate themselves about products, rather than turning to someone else for explanations. The biggest source of information about products, besides product reviews or peer reviews, comes from content marketing, consisting of blog posts and articles. This drives them to your website in search of answers and empowers them with information to make decisions.
In the past, the life insurance industry has relied upon a human-only distribution model, with brokers behind desks in offices around the country. They’ve collected pen and paper applications and sent them to underwriters, and this means the consumer has to wait weeks or even months at a time to hear back on a decision. This model has proven to be inefficient and ineffective at reaching a tech-savvy generation.
In this weekly series on selling life insurance to a new generation, I’ll be covering several topics including the importance of mobile in a millennial marketplace, reaching this demographic through digital marketing, meeting clients where they’re at, and the importance of giving them research tools as well as the ability to apply online. Stay tuned each week as I delve deeper into how to target and distribute life insurance products to a tech-savvy, mobile-first generation.