The ‘aging population’ is a phrase usually thrown around with negative implications of higher tax rates and a shrinking workforce – but it’s not all bad news for the insurance industry.
In fact, the likelihood of a person purchasing insurance increases with age, especially when it comes to travel insurance, according to Patrick Robinson, CEO of Canadian travel insurance provider TuGo.
Canadians love to travel. As a result, the Canadian travel insurance industry is growing, with 2018 projections reaching upwards of $865 million. However, a recent survey by the Conference Board of Canada found that only 65.8% of Canadians aged 18-34 had travel insurance coverage on their last trip, compared to 86.5% of Canadians over 55.
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That 34% gap in the ‘younger generation’ travel insurance market is an exciting prospect for insurers and brokers, Robinson said.
“Younger Canadians, aged 18-34, often tend to skip out on travel insurance when compared to their older counterparts (34% versus 13%, respectively), but younger people today are no different than in previous generations in that they don’t think anything will happen to them,” he told Insurance Business.
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“The major differences are in their access to information – both the amount and the method of delivery. Millennials are used to working with information, and the insurance industry needs to constantly adapt to how people want to receive and manage information.”
To cater to millennial demands, TuGo has been developing mobile-friendly, easy-to-use technologies, and training its insurance partners on how to embrace the technological shift. The company is preparing for a future where buying power is shifting to younger generations who are craving a simplified travel insurance experience, Robinson explained.
Technology should be viewed as a positive element for brokers to take advantage of, according to Robinson. It allows brokers to deliver information to their customers in a way that they prefer, and makes it easier for them to understand – especially among tech-savvy millennials.
“A new generation of travellers have different preferences and requirements, to more adventurous destinations and more frequent, shorter trips,” added Robinson. “Adventure travel is on the rise, with more and more travellers pushing themselves out of their comfort zones in search of holistic experiences, over typical site-seeing.
“And, of course, technology has opened up a new world of possibilities for travel – and consequently, insurance.”
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