Millennials and Gen-Zers lagging behind other generations for insurance cover
Older insurance customers have reached market saturation, while youngsters offer largest growth potential.
From March 2017 to March 2018, Millennials and Generation Z exhibited the greatest potential for growth in the insurance sector, according to Roy Morgan research. Surveyors found that the two generations have fewer insurance policies to their names.
Why do Millenials and Gen-Z buy less insurance?
Mainly due to their respective youthfulness. Demographers define the Millennials group as having a birth date between 1976 and 1990. The younger Gen-Z cohort was born between 1991 and 2005. Because of their age, Roy Morgan researchers found the group own fewer properties than the older generations. Generation Z accounts for only 7.4% of the annual insurance premiums generated. Millennials make up almost a quarter, with 23.1% of the total insurance market.
Baby Boomers and those born before 1946 had general insurance rates of 93% and 91.3% respectively. Generation X was close behind with 90.6% having a general insurance policy.
Analysts noted that these three groups were close to saturation point, with lower growth possibilities. Pre-boomers represent 11.9%, but as the company pointed out, this group is in decline due to old age. Number crunchers suggested insurers should focus on customer retention for this bracket.
“The growth prospects appear to be greatest with the growing needs of millennials and gen Z but at the same time there is a need to retain the customers in the three older age groups,” Roy Morgan’s industry communications director Norman Morris said.
Morris highlighted the need for insurers to concentrate on customer service and keen pricing.
“This is a highly competitive market where many shop around at renewal time, so there is a need to focus on customer satisfaction and competitive pricing,” said Morris.
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