The generation born roughly between 1980 and 2000 is referred to as the millennial. This generation has grown up experiencing the incredible rise of digital technologies, which has an impact on every aspect of their lives. Accustomed to accessing information/services at their convenient time and place, this generation is setting new benchmarks in the customer experience domain. The biggest challenge for insurers today is to face and match the expectations of the millennial generation of customers.
What do millennial customers want? Why should insurers care about them?
The millennial insurance customers demand prompt, seamless, and hassle-free services at time & place of their choice with contextual experiences across a variety of channels and devices. They prefer to explore information and evaluate insurance products on their own, read reviews about brands/products on the social networking platforms, and seek recommendations from their peer groups before making a potential buying decision. They emphasize buying experience more than price and coverage of insurance. Insurers will need a change in their orientation to treat 'customer experience' as the core product of their business instead of traditional pricing and coverage.
Today, the millennials are the largest demographics in the US with a significant purchasing power and ability to
influence markets. As the number of millennials would grow further, they would influence insurance product development and market strategies globally. A Novarica study conducted in the year 2016 revealed, 75% of the millennials want to do business online. The study further revealed:
- Millennials extensively use search engines, preferably Google, to look for information about brands and products online.
- They don’t want to be sold to.
- They want to guide their own purchasing processes.
- They hate traditional channels such as faxing, emailing, telephone calls, in-person sales, etc.
Okay…so how do I plan for the millennial customers?
In a recent webinar titled, Are P/C insurers willing to be left behind in the era of Digital Natives?, Martina Conlon of Novarica shared a few major characteristics of the insurers who would be able to capture the large shares of the millennial market. These insurers would have:
- A robust search engine presence: As millennials google everything, a robust search engine presence is a must for insurers.
- A good word-of-mouth reputation: In the age of social networking, active management of social media engagements is going to be critically important. Social media is an excellent platform to reach out to a larger audience.
- Straight forward, user-friendly point of sale & service: Rapid claims responses and hassle-free services to address customer issues will help retain millennials as loyal customers.
- Support for customers to purchase their coverage online: Offer customers the ability to purchase coverages online without having to engage with in-person staff.
- No requirements for policyholders to mail or fax items: Millennials do not prefer anything to be mailed or faxed to them. Adopt paperless capabilities such as e-signature to complete online experiences.
- Support for online, automatic payments: Provide support for automatic payments, quick secure and effective payments at the time of purchase.
- Transparency: Keep transparency of what data you collect from the policyholders and how the data is going to be used and kept safe.
- Paperless Process: Provide support for claims, endorsements, and renewals through paperless processes and clearly worded forms.
Martina Conlon further added that insurers who wish to attract millennial customers should target the following technological investments and strategies:
- Comparative product shopping experience
- Customer portals for millennials to sign up and maintain online accounts
- Build paperless processes
- Avoid “one size fits all” solutions and messages
- Provide omni-channel capabilities
Millennials as future employees…creating a conducive work environment for millennials
Studies have shown that by 2025, millennials will represent 75 percent of the global workforce. As the insurance professionals from the baby boomer generation are leaving the industry through retirement, millennials are going to take these positions and actively participate in shaping the future of the industry.
However, because the millennials have the common perception that insurance is an old industry running on old technologies, they are not particularly enthusiastic in choosing insurance as a career option. The industry needs an image makeover and efforts toward changing this perception. Millennials have certain expectations from their employers, which insurers would have to fulfil.
- Millennial prefer organizations that encourage technological innovations. The traditional insurers find technological transformation challenging because of its risk averse culture, product specific approach and traditional ways of doing business. Insurers need to work towards fostering a culture of innovation without the fear of failing.
- Millennials are a value-driven generation. More than the financial reason, millennials would prefer to associate with an organization because it is socially responsible and contributes positively toward the betterment of the society.
- Millennial is the most tech-savvy generation and they seek similar tech-savvy environment in their workplace.
Millennials are keen on joining organizations, which provide opportunities to grow their careers. Helping coach and mentor millennials to acquire new skills and attain leadership positions in the organization would go a long way in attracting and retaining millennials.
View On-Demand Webinar
Click below to view the webinar Are P/C insurers willing to be left behind in the era of Digital Natives? on-demand, which features Novarica, NSM Insurance and ValueMomentum to understand the rationale of why P/C insurers must adopt digital technologies today and the key factors to consider when building a digital strategy.