Selling Life Insurance to Millennials

By Mikaela Parrick

They’re also at an age when they should be thinking about buying life insurance, but in reality, it’s at the bottom of many millennials’ priority lists.

According to a recent survey from Bestow, about 70% of Americans don’t have life insurance, including 75% of parents in the millennial generation.

When asked their reason for not buying life insurance, half of the respondents simply said that nobody had ever approached them about the topic.

The other half cited several reasons: basic misunderstandings about life insurance and how it works, concerns about cost and convenience and a general unwillingness to consider their own death.

Address the misconceptions

Concerns about costs are the main reason why most millennials don’t have life insurance.

According to a study by Life Happens and LIMRA, 73% of millennials consider life insurance to be too expensive.

In fact, 6 out of 10 millennials overestimated the cost of life insurance by 3 times on average.

When asked how much a 20-year, $250,000 term life insurance policy would cost for a healthy 30-year-old, 44% of millennials thought it would cost over $1,000 per year.

In reality, the number is about a third of that.

Life insurance also tends to scare millennials because they think of it as an investment instead of a safety net.

Be sure to address the misconceptions about life insurance and explain the many benefits it provides, like:

• A means for paying off any debt the decedent may have (like loans!)
• Funding for future education expenses for insured’s children or grandchildren someday
• Covering estate taxes
• Equalling out an inheritance

Millennials may also be interested to know they can purchase a life insurance policy with the name of their favorite charity as the beneficiary to provide funding for causes they care about.

Don’t assume they know the jargon

A 2017 survey from Anthem found that only 53% of millennial respondents understand life insurance coverage and the benefits that it provides.

What’s the difference between term life insurance and whole life insurance? Most millennials don’t know the answer.

According to the Life Happens survey, 80% of respondents wanted coverage that was easy to understand, and 70% wanted to speak to someone about their life insurance needs.

Make sure insureds fully understand the different types of policies available and what types of benefits they can enjoy from getting a life insurance policy.

Make it easy

Two-thirds of millennial parents believe that they haven’t got the time to sift through the options, and generally, they won’t devote more than two hours to the process.

To millennials, many traditional insurance practices are seen more as obstacles than standard business practices:

• Why wait three days for a quote?
• Why visit your office?
• Why fill out paperwork?

[ Related: The Evolving Role of Insurance Brokers ]

Another frequently-cited reason why most millennials don’t have life insurance is that they don’t want to bother with the medical tests and exams typically required to get life insurance, which is why some insurance companies are making it easier than ever by offering selfie quotes.

“Selfie” quotes work by using facial analytics technology to examine hundreds of points and thousands of regions on the face to instantly find BMI, age, gender and smoking indication.

Insureds only need to submit a “selfie” to get an instant life insurance quote, which is proving to be successful among the younger generations.

While there are still some issues with the accuracy of facial analytics technology, Blair Baldwin, Co-Founder and CEO of Quilt, says the goal behind the selfie quote isn’t 100% accuracy.

In an article by the Huffington Post, Baldwin states, “Really, the goal behind the selfie quote isn’t 100% accuracy. We see it more as a way to engage younger people with life insurance, which is something they may not know they need, and to do it in a really fun and accessible way.”

Millennials are undoubtedly unique, but every generation is.

The secret to selling them life insurance lies in understanding and addressing their unique values.

[ Related: Why Don’t Millennials Want to Work in Insurance? ]

Suggestions? Take this short survey.