Generation Z and millennials have different insurance needs from their elders, yet they are already a market force to be reckoned with. More than 60% plan to purchase one or more types of insurance policies within the next 12 months. Regardless of which type they buy, half prefer to purchase it online, and when they do, they are largely researching their selections on the internet and social media. Instant insurance disbursements are also highly appealing to young consumers, as two-thirds of millennials would choose to receive payouts instantly if they could.
Having grown up in a world that was not only digital- but also mobile-first, these generations expect speed and immediacy in their digital interactions. However, despite their digital-first approach, three-quarters say they still want access to in-person advice from an insurance professional before purchasing online. The reason? Most do not feel confident in their understanding of the service. To gain digital natives’ loyalty, insurers must walk a fine line between digital agility and relationship building.
The “B2B and Digital Payments Tracker®” examines how the complex digital expectations of a new generation of policyholders is challenging and transforming the insurance industry.
Insurers hoping to engage a Generation Z audience must provide digital tools and unbiased information. Being digitally native, Gen Z consumers are much more at home online than any other insurance customers. Carriers offering digital payment methods such as Venmo, PayPal and Apple Pay can make insurance shopping more accessible to this generation. However, as relative newcomers to the market, Gen Z consumers crave information above all else — and, lacking deep pockets, specifically want price comparison data.
Gen Z is driving a trend toward making the process more “authentic, honest and immediate,” according to a recent podcast, owing to the generation’s expectations for smooth digital insurance experiences and 24/7 availability. However, participants asserted that in an industry as complex and relationship driven, there must be a balance between digital and human experiences. Companies must be sure to offer technology that supplements, rather than supplants, human support.
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Gen Z and millennial consumers set a high bar for digital experiences across industries — including insurance. These generations are all about frictionless, effortless digital interactions — and insurers have accepted the challenge.
To get the Insider POV, PYMNTS Intelligence interviewed Ian Drysdale, CEO of insurance industry digital payments network One Inc, to learn how insurance companies are putting a high priority on a millennial- and Gen Z-friendly digital transformation to help attract and retain this new generation of policyholders.
The generation gap does not make headlines as much as it used to, but it has unquestionably widened in recent years through the rapid advancement of technology. As younger consumers’ digital expectations evolve faster than insurance processes, a notable gap has grown between what insurers offer and what these customers want. For carriers looking to cover this next generation, customer experience has never been more important. As personalized advice, omnichannel offerings and seamless end-to-end journeys become the norm across industries, insurers must find a way to meet the needs of the growing generation of digital natives — or risk losing them to challengers.