Recent research conducted by LIMRA found there is a $16 trillion gap in U.S. life insurance coverage – a good majority of which can be attributed to millennials. Millennials, anyone born between 1981 and 1996 (ages 23-38), are the least likely to carry life insurance – even if they are married and have children.
To investigate the discrepancy further, Hyland recently conducted a survey of more than 300 millennials from across the U.S. to learn more about millennials’ life insurance purchasing decisions, or lack thereof, by asking what compels them to engage with a life insurer. Our survey uncovered some interesting insights – most importantly, that millennials don’t exactly know where to start when it comes to life insurance.
Millennials are looking for help, and that’s good news. The bad news is they expect help via the channels they are already accustomed to – digital and social channels – which most life insurers haven’t adopted yet.
For life insurers, millennials are an untapped market, and they’re looking for innovative, digital-first experiences. Here are some tips life insurers can implement to help better position themselves.
Be a trusted adviser
Only 38% of the millennials surveyed said they carried a life insurance policy that covered all major expenses. Roughly 62% said they were uninsured or only carried life insurance through their employer.
Although we live in a world where information is readily available at the tap of the screen, millennials still seek experts to help them make the right purchasing decision. Some of the more innovative life insurers are at an advantage because they already have the right technology in place to offer information and fully digital experiences.
See also: How to Resuscitate Life Insurance
So how can you set yourself up for success with the millennial market? Success first involves assessing your current processes and product offerings – and seeing how you can evolve them digitally. Many insurers are investing in technologies, like content services platforms, to digitize information and processes, streamline operations and offer the best service possible. Many of these systems integrate directly with core line-of-business processes to ensure a digital experience from the initial request for information through policy acceptance.
Expedite the process
The survey found that 45% of respondents prioritize other financial goals over life insurance. Of that, nearly 25% said they haven’t even considered purchasing a life insurance policy, and 6% think the process is outdated and intrusive. Additionally, millennials believe life insurance premiums are far more expensive than they actually are – up to five times more expensive, according to a Life Happens report.
It’s clear that many millennials are uninformed about life insurance, although they know it is important and can give their loved ones peace of mind and financial protection. Insurers can help millennials by meeting them where they are. This means reimagining current business processes and designing a digital model by harnessing the right technologies.
An important aspect of digital transformation isn’t just to recreate a paper process in digital form. Map the process and imagine how you can transform it with electronic workflow and automated notifications to keep the process moving. This will meet millennials' expectations for quick access to information and even quicker processes.
One respondent said, “Life insurance feels very complicated and difficult to learn. If they could ‘dumb it down’ and show how policies/payments/industry worked, it would be so helpful.” Education was another major theme that came through the survey. Becoming a modern life insurer means becoming both more engaging and more informative. Life insurers need to move beyond old tactics, like cold calls and mailers, and start using technology like chatbots driven by AI.
See also: Digital Distribution in Life Insurance
Content services platforms help support additional digital transformation goals by fueling life insurers’ ability to engage with the customer, learn about their needs and provide them with products and services they want – faster than ever. Capabilities like intelligent automation technology can anticipate the needs of both users and customers to drive automated processes – helping employees focus on high-value tasks and develop more meaningful conversations.
Millennials are a largely untapped market for life insurers. Hyland’s recent survey found that millennials need a better guide to help them along the way – from education through policy selection. Insurers that are adaptive, flexible and innovative are at an advantage over competitors that are stuck in their ways. By embracing and investing in digital transformation technologies, like content services, life insurers can fill the gap and better reach millennials. Providing them with easy, secure and complete access to information, anytime and anywhere, will facilitate more responsive and meaningful interactions. In turn, these technologies streamline processes, lower costs and improve overall experiences for customers – traits that are appealing to every market.