How to make insurance appealing to millennials, Gen Z

Millennials and Gen Zers will represent 75% of the U.S. workforce by 2025 and will come to represent a huge chunk of the buying power in the economy. Industries across the board are adjusting to this vastly different consumer market, and insurance is no exception.

Of course, insurance customers of all generations prefer easier and more beneficial products, but expectations for ease of purchase and use seem to be more critical for millennials and Gen Zers who grew up with the internet. 

The challenge of building intuitive products coupled with excellent customer experience is common for many industries. But for insurers, it is a much bigger challenge. Insurance offerings are not intuitive and most people don’t understand the intricacies of insurance. As such, insurance has traditionally been ‘served’ to customers via brokers and is still lagging behind other industries in terms of digitalization and self-service. 

Here are a few general guidelines regarding these up-and-coming generations:

Increased digitization and automation

Growing up surrounded by search technologies, online shopping, and mobile apps means that these digital natives have come to expect speed and efficiency. The same is true when it comes to interacting with insurance.

Insurers that insist on preserving outdated legacy systems incompatible with existing tech stacks are sure to dissuade these generations from climbing on board. Rather, new customers will be drawn to providers that can deliver instant gratification through innovative apps and websites that automate certain insurance processes, making them simpler and more efficient.  

Superior customer service and clear communication

Although user-friendly technology is certainly desired by these younger generations, it doesn’t negate the need for high-quality customer service. Take it from millennials themselves: over 70% say the most important thing businesses can do is show that they value customers’ time. 

For insurers, this means they need to respond to customer queries quickly, especially when a situation necessitates a call with an agent. Prolonged wait times can easily drive younger customers away. 

Once connected, insurance agents should gather as much information as they can via CRM software or healthcare databases in order to avoid asking the customer extraneous questions. During this process, agents must be acutely aware of simplifying the language and terms they’re using to make sure explanations are clear. 

Convenience

Convenience is often a dealbreaker for young consumers – many are not willing to invest time and effort in searching for the optimal insurance product. Rather, most expect to be offered insurance that is tailored, easily purchasable and digitally managed. 

Moreover, technological innovations such as the recent introduction of ChatGPT are also changing the way we consume data and how customers expect to interact with their service providers. Instead of following a preset chat protocol (as with most chatbots), ChatGPT’s AI-based versatility and improvisation capabilities allow customers to ask questions in different ways and still receive the right data quickly. 

Insurers therefore need to be able to provide convenience on two fronts – via their technology and throughout their customer service journey. And personalization counts: younger customers gravitate towards insurers whose claims filing services, quote assessments, and overall insurance models directly cater to their needs on a case-by-case basis. 

How insurers can deliver

1. Gamification 

With its myriad of caveats and conditional clauses, insurance has cultivated a reputation for being difficult to navigate, even when agents attempt to clarify points of confusion. 

Gamification, however – the integration of challenge-and-reward mechanics – can alleviate these frustrations and vastly improve the customer experience. It gives agents the strategic opportunity to use game-inspired campaigns to educate prospective customers on the various policies that best fit them. For example, prominent Scandinavian insurance provider, Tryg, used an online quiz to generate outbound leads and raise awareness for their dental insurance offering, providing participants a chance to win an electric toothbrush. 

2. Omnichannel support

Addressing customer inquiries quickly and efficiently can influence the way a business or brand is perceived. Though inquiries can come via several social media and website channels,  the majority of millennials expect consistent user experiences from every channel they use. Without a system in place to integrate and streamline them all, many customer inquiries can easily slip through the cracks, which reflects poorly on the company. 

This is why omnichannel support is so valuable, as it merges all of a business’ communication platforms into one. For insurers, this can help create seamless, intuitive interactions with users anytime, anyplace, regardless of channel or device. 

Break the mold

Consumer culture is becoming more and more tech-savvy and favors organizations that go the extra mile to fit changing lifestyle habits. 

It is, therefore, crucial that the insurance industry does everything in its power to cater to the latest digital trends and customer expectations. Insurers that can’t keep up with technological advancements and bridge the digitalization gap may soon face the cost of losing customers.