When it comes to selling insurance policies of any type to young adults, many policy providers have likely found the last several years to be particularly difficult. However, it seems that there are several reasons for this, which could present significant hurdles for such companies to overcome in the near future.
The fact of the matter is that the youngest generation of adults today has largely stayed out of many aspects of the insurance industry that their parents would have been involved with heavily, according to a report from Property Casualty 360. A recent study from Princeton Survey Research Associates International found that only 10 percent of millennials have homeowners insurance, while just 13 percent have renters insurance. That can be easily explained as being a factor of very few young adults even owning their own homes, and few wanting to take on the extra - if minimal - expense of renters coverage. However, a more startling statistic may be that just 64 percent have auto policies in their names.
That could present major issues for such companies going forward, but at the same time, it should also give them reason for significant introspection, the report said. A recent survey of this generation of young adults found that even those who have homeowners insurance are extremely dissatisfied with both their policies and insurance providers in particular.
Figuring out why
Experts say that there are many reasons these issues might be so prevalent even today, the report said. Perhaps chief among them is that young people are constantly bombarded with ads for insurance of all types, and over the course of their lives might have come to resent traditional advertising as an unwanted intrusion into their lives, in ways that they might not view other kinds of advertising (online banner ads, via social media, and so on). Further, surveys also show that young adults are generally uneducated about the ways in which the insurance industry works, and may significantly overestimate the cost of the coverage they'll need.
For these reasons, it might be incumbent upon insurers to start to bridge these prospective gaps in trust and understanding between their offerings and the young people who are supposed to be buying them for potentially decades to come. The more that can be done to reach these consumers in ways they'll find palatable, the better off insurers are likely to be going forward.