Generation Y, millennials – however you choose to describe them – they are the customer base that almost all industries are scrambling to adapt their approach for.
But what does Gen Y want as a consumer group, and how can the insurance industry – often criticised for being overly traditional – bring them in, and keep them?
“Highly-prized” millennials seek convenience, agility and personalisation from service providers, which goes some way to explaining why insurtechs are such a hit with the group, according to a new World Insurance Report from Capgemini and Efma.
Young and tech-native, Gen Y also tends to be less loyal, which makes it especially important for insurers to build and maintain relationships with them. The answer as to how? Give them what they want – a pain-free experience.
“Generation Y is very tech-savvy, has little patience, and wants multiple options,” Vijay Amballa, group VP of global insurance at Capgemini, told Insurance Business. “They have an ‘I am the customer, not you, Mr Insurer,’ kind of personality.”
The younger generation, demanding flexibility and digital platforms, has helped pressure the industry into adopting new technologies, but they are also less concerned with the history and financial stability that many incumbent insurers rely on in the competition against insurtechs.
“What they’re asking is, not how complex and how robust an insurance policy is and how big a company that is offering it is, all they are caring for is – I don’t have time, I like to be able to do things on my cell phone, and to be able to be connected,” Amballa explained.
Used to interacting online and via social media platforms, Gen Y doesn’t want to be forced to pick up the phone, and instead looks for a “seamless” experience from insurers. So far that hasn’t been great news for incumbent insurers, which have remained largely static while many of the insurtechs “appeal directly to the needs and preferences” of millennials, according to the report.
“Someone who can give them those features, even if it’s not a 10-year-old insurance company, they are going to go with them. A product which is convenient is the top factor for them,” Amballa said.
But should insurers get it right, Gen Y can be persuaded to stay put.
“If you do give them that opportunity and the tools, such as a mobile or chatbots… once they have that ease of use, they are very likely to come back to you and stay with you,” Amballa concluded. “For them, the most important part is comfort, ease, and speed.”