Generation Z and insurance: Brokers urgently need to rethink!

Generation Z and insurance: Brokers urgently need to rethink!

Generation Z faces a major challenge when it comes to taking out insurance. A current study by Sirius Campus GmbH shows that young adults between the ages of 16 and 30 rarely take out their first insurance through an insurance broker. According to the results, which are based on a survey of 1,626 people, younger generations in particular have less access to insurance contracts.

On average, 16 to 18 year olds have around two insurance policies, which are often taken out by their parents. In contrast, 28 to 30 year olds have an average of four contracts, with private liability, household contents and motor vehicle insurance being particularly relevant. Important life events such as buying a car, the birth of a child or starting a career often lead to the purchase of insurance.

First contact with the insurance company

The study also shows that 42% of young adults take out their first insurance contract through an intermediary. Another 29% purchase insurance directly from the provider. Comparison portals, on the other hand, play a minor role at only 10%. The most common closing locations are an insurance company's office and online platforms.

It is critical for the insurance industry to understand the needs of Generation Z. According to research by Deloitte, this is the first generation to grow up with modern technologies and the Internet. Purchasing decisions are heavily influenced by social media and digital information. This means that the traditional method of “push” selling is increasingly no longer working; Rather, insurance must be presented in such a way that it attracts the interest of young consumers.

The path to taking out insurance

Deloitte highlights that it is important to address Generation Z's expectations at various stages of the buying process. It starts with determining the need, followed by creating an awareness of the relevance of insurance. The analysis shows that low awareness and lack of knowledge often lead to uninformed decisions. Furthermore, weighing up options is crucial, with young consumers having clear purchasing criteria.

A key aspect is Generation Z's willingness to provide personal data for benefits, especially when it comes to concluding a contract via remote channels. Effective sources of information, such as informative TikTok videos, prove to be stronger incentives to purchase insurance, while short and funny videos are less effective. In order to promote the purchase of insurance, it is necessary to build up knowledge about risks and the usefulness of insurance.

The results of both studies make it clear that insurance brokers and providers need to work on adapting their strategies to better reach the young target group and address their concerns. Access to this potential customer group could be crucial for future business models in the insurance industry.

Further information on the topic can be found in the studies by Insurance Journal as well as from Deloitte to find.