By Jason Walker
Millennials, Generation Y, Gen Next, Boomerang Generation – no matter what they are called, this group of 20 to 30 years olds have been wreaking havoc on the market across industries – perhaps with the insurance sector facing the most disruption. These consumers want on-demand service whether it is for shopping, paying bills, or conducting insurance transactions. If agents can’t provide the customer service they require, they find agents, or insurtechs, that can. And it’s not just access–product preferences are shifting. Ride sharing and living-with-parents after college have reduced needs for auto and home insurance. Less compulsory products like life insurance are becoming an even harder sell, with the next generation thinking about life insurance as something they might eventually want, but most certainly do not need at this point in their lives.
Many millennials graduated during the downturn of the economy. They often possess significant student loan debt and are frugal, preferring to save their big purchases for life experiences such as exotic trips and unique activities rather than planning for life crises.
Moreover, what’s worked in the past, won’t work as well in the future. Agents also need to adjust their current processes to make the life insurance transactions more efficient. Millennials put a high premium on speed and ease in doing business.
This is where digital solutions can help. Most life insurance agents have quoting and proposal tools and a customer relationship management (CRM) system. But these solutions aren’t enough when targeting the younger generation. New communication outlets, including social media and text messaging, can take the agent/client relationship to platforms where customers feel most comfortable. Automating routine functions can speed up the application process.
Here are three key areas to consider to make the most of digital technology:
- Keep it personal, but embrace the virtual
Traditionally, life insurance sales revolved around face to face interactions; that sometimes resulted in 14-16 meetings a year with a top client. But millennials are wired to other communication methods including text messages, email and social media. And even face-to-face no longer requires two people in the same location. Agents can have virtual meetings using platforms like Skype or even FaceTime.
Life insurance agents need to be flexible and willing to adjust their communications methods to fit their clients’ preferences. For some customers, this may involve the traditional multiple in person meetings at the agent’s office accompanied by follow up phone calls and emails between visits. But for other clients, they might only meet the agent once in her office and then rely on other communication outlets that extend beyond phone and email. If the client has a quick question about the application process or her policy premiums, she might choose to send the agent a quick text message in the hopes of getting a speedy reply. For additional meetings and check-ins the customer might opt to have a video conference with the agent instead of trekking into the agency.
Agents should incorporate a scheduling tool to help manage their calendars and to keep track of the communications preferences of their individual clients. Steady communication is very important in the life insurance industry and automating scheduling and rescheduling can create a much better experience for clients and prospective clients. It also saves the agent time enabling them to communicate with more people on a daily basis.
Agents should also ensure they have access to the technologies their customers are using. Some services like Skype or Google Hangout are free for video conferences and used by a large number of consumers. But agents may also need access to a web conference platform. In addition to talking with clients about their needs and projections for the future, agents need to share a variety of information and documents with them to meet compliance standards including state mandated notices, buyer guides, and disclosures forms required by the state and insurance company. This platform allows agents to not only communicate with clients, but also share presentations and documents that enable the agent and customer to review information at the same time ensuring they remain compliant.
Finally, life insurance agents need to have a social media presence. This not only provides another outlet for customers to reach out and communicate, but it also is a great platform for recruiting new clients. Prospective clients will often turn to social media to request recommendations from their peers on a variety of topics including financial and insurance topics. According to the research organization, LIMRA’s Insurance Barometer Study, more than a third of Americans and more than half of millennials are likely to ask for recommendations for an insurance agent or financial advisor on social media. With active accounts on these platforms, life insurance agents can insert themselves into the conversation.
- Turn the want into a need
Life insurance for many millennials, who are trying to pay off student loan debt, seems like an added expense they can do without. They are young and the odds are in their favor that they will not need to be cashing in a life insurance policy anytime soon. Agents should work to shift this narrative and demonstrate why it’s important to buy policies now. Life insurance is tied to key variables – health and age which typically do not improve with time. Consumers have access to the most favorable life insurance rates when these two variables are on their side.
Helping clients look ahead 10 years, 20 years and even 30 years can help them see and understand the multiple opportunities for insurance at different stages of life. Incorporating an account aggregation tool can help facilitate these projections. Agents can get a clear window into their clients’ finances, which gives them an accurate view into the customers’ current circumstances. It allows agents to make product recommendations and to serve the client holistically. It also advances the customer/agent relationship, turning the agent into an advisor that can recognize other planning opportunities outside of just life insurance sales.
- Life insurance application process shouldn’t feel like a lifetime
Millennials want the trusted advisor and tailored advice that a seasoned life insurance agent can provide – but they don’t want huge hassles. Agents should digitize as much of the enrollment process as possible. Can the initial forms be filled out and submitted online? What documents can be signed using e-signature and returned via email, eliminating the need for the client to locate a stamp and mail the physical copy?
Agents should also implement an online service portal for their existing customers. For routine simple edits such as beneficiary changes, bank information or new address, millennials would prefer to not have to do an email exchange, or make a phone call to the office for these adjustments. Portals enable customers to log into their own account and make these changes themselves. It also reduces the agent’s workflow, giving them more time for sales and complex client issues.
Millennials are disrupting how all industries operate and life insurance is not an exception. This demographic has different priorities and the tactics that worked on previous generations will not be sufficient to engage this consumer group who expect fast, on-demand and simple service. With the right digital tools, agents can interact with the clients the way they prefer and shift the narrative demonstrating that life insurance is not a luxury, but a vital tool that could benefit the customer and her family for years to come.
As managing partner at Smart Harbor, Jason Walker oversees the strategy, development and delivery of the company’s technology solutions and analytics platforms for the insurance market. He brings both significant insurance and business-to-business technology marketing experience to his role. He was previously founder and executive of People To My Site, a company that developed digital marketing programs for automotive dealers and franchises. He is currently an advisory council member for the Insurance Digital Revolution, an industry organization focused on advancing digital technology adoption among independent insurance agents.