Life insurance companies are looking for new ways to increase business as a consequence of the decline in interest in such products resulting from the recession. As older Americans began to view these policies as being extraneous, rather than necessary, it might be time to turn the focus to the generation which will eventually replace them.
Millennials may offer fertile ground for life insurance products and annuities to insurers, which take the time to market to them directly, rather than more broadly across a few generations' worth of consumers, according to a report from Life Health Pro. One of the best ways to do this may be to try to embrace the non-traditional values (in comparison to Generation X or baby boomers) that many young people might hold dear, and clearly point to the benefits these kinds of policies. This is a generation that values individuality and concision, and perhaps transparency above all, and tapping into that may be vital to landing a sale.
Those in Generation Y may also value the ability to deal with their accounts on a number of different platforms, and developing mobile apps and online options will likewise be essential to ensuring that younger people come into the industry for the first time, the report said. In addition, many millennials may also not really know much about the life insurance or annuities industries, and thus it will be vital for companies to help them navigate the ins and outs specific to their own needs and highlight how these products can help them down the road.
Of course, when dealing with young people today, companies will also have to take into account that they'll likely live longer than the generations before them. With increasing life expectancy, there will be both opportunities and challenges for the life market. On one hand, annuity products that provide guaranteed and secure income stream and other insurance products with investment and saving features will gain their popularity; on the other side, it also imposes some challenges on the insurers due to increasing cost of providing insurance coverage, complexity in pricing at older ages, and the need to design and offer a variety of products to satisfy customers' need.