Millennials are a group of people born between 1981 and 1996 and are currently between 23 and 38 years old. There are over 75,000,000 millennials on the planet and by 2025, they will account for 75% of the global market. The people in this group have grown up in a different world than older generations and as a result, they have different lifestyles and expectations. These factors impact how they connect with and use insurance.

Making the Connection

Millennials live in a world of customized experiences, from purchasing clothing to ordering food, and they patronize businesses that put them front and center of all marketing efforts. They also prefer online interactions to face-to-face ones as much as possible, especially for business transactions. Their lifestyles are also different than prior generations. They get married later, have fewer children and are more likely to rent than own a home.

Millennials don’t like to read newspapers, watch commercials, or answer telemarketing calls. They are more concerned about losing their mobile phones than their cars. Given this information, an insurance company must take several actions to truly connect with members of this generation. To do this they should:

• Market on New Channels. Social media is the best way to market to this generation, and the information presented must be relevant to their lives, not that of their parents. Insurance companies must become savvy at reaching this market group across several social media channels.
• Leverage Technology. Online quotes and immediate access to questions or claims is a must. The more responsive and customer-focused the company, the more loyal millennials will be.
• Change the Insurance Marketing Portrayals. Most insurance company ads include a happy couple with two children in front of a large home. This image doesn’t reflect the realities of the lives of millennials. One child is more likely than two and homeownership is giving way to rental properties. Sales messages need to be adjusted to reflect this demographic.
• Understand What’s Important to this Generation. Protecting their electronics is more important than protecting their clothes, furniture or car. Creating products that address these needs is a must.

Adjusting Products and Focus

Given the expectations of millennials and their strong buying power, insurance companies need to deliver the products and services they want. This includes:

• Rethinking Car Insurance. Car ownership isn’t important to many millennials because they use ridesharing services. They postpone purchasing a car or choose not to at all. To be responsive to this reality, product offerings should now include rideshares insurance, bike insurance, and pay-as-you-go car coverage.
• Expanded Home Rental Insurance Options. Consider home rentals from the perspective of millennials and adjust coverage accordingly or offer more coverage options. This group tends to be higher educated and more affluent than home renters of the past and will expect to stay in the rental property longer.
• Adjust what Home and Rental Insurance Covers. Electronics is the biggest focus of this generation but most home and rental insurance policies include this in these items in the general personal property section. Riders can be used to specifically address expensive electronics but for millennials, this should be a focus already in the policy and under its own section/header.

Truly connecting with and delivering what millennials want and need begins with recognizing that this generation is truly different than those that came before. Understanding what is important to them is key and appreciating that old models of communication won’t work is the place to start.

At Alliance, we proudly serve millennials by offering the online services they want and the coverages they need. Although this generation has specific expectations, we never lose sight of the fact that we don’t serve the group, we serve each person and family seeking the right insurance that fits their lives.