Outside-IN

Millennials and life insurance — not their parents' policies

New offerings for the younger market have made the life insurance industry ripe for disruption

Jun 22, 2016 @ 10:00 am

By Andrew Bucklee

Millennials are a unique generation with a new approach to life,which includes the way they secure information, collect insights and make purchasing decisions. This is especially true when it comes to benefits and financial products — particularly life insurance.

In this underserved segment, only 16% own individual life insurance and about a third are likely to purchase it. In a market historically driven by the business of an older, wealthier clientele, today's financial advisers have a unique opportunity to provide policies to a generation that tweets, texts, blogs and looks online for key information and purchases to complement their lifestyle.

For decades, insurance companies cut their teeth selling products with lengthy underwriting and application processes, carving out a niche among old guard policy holders. Advisers must find a way to adapt to the shifting marketplace, reaching younger generations through new techniques, products and processes.

BREAKING THROUGH

Millennials are the nation's largest living generation, having surpassed the population of baby boomers. They comprise more than a quarter of the nation's population. Their expectations are driven largely by experiences with other industries and by the way they gather information, with an increasing reliance on mobile and online technology. Their preferences for working with financial institutions are no exception. Fifty-six percent of millennials would rather use an ATM, personal computer, telephone or mail than sit with a financial representative.

Millennials are uprooting the way our world does business, shaking up the status quo and steering the way many companies operate. And like most Americans, they are underinsured. While 41% of millennials agree they should put more money into life insurance, one in two say paying off short-term debt is more important at this stage of life.

New life insurance products and processes are putting advisers in a unique position to reframe their conversation with millennials — helping younger generations understand and appreciate the need for life insurance and how it can help to protect their assets and loved ones.

Today's options are more streamlined, varied and flexible, offering choice to a generation that values technology, simplicity and speed. Advancements in automation, delivery, underwriting and technology are helping advisers reach younger policy owners in a fraction of the time, providing them with an experience more consistent with their expectations. Insurers now are able to turn a policy around in just a few days.

Term products offer a fully electronic and efficient transaction process, from application to policy delivery. Possibilities for lab-free underwriting have also become a reality among an audience seeking a less invasive, faster and more simplified experience. And options with lower face amounts are providing millennials with attainable coverage at a time where they may be facing competing financial priorities.

PROGRESSIVE SUCCESS

The most progressive agents and agencies are getting into the game — turning to technology and alternative forms of communication to reach a younger client base. Those who are successful have shifted their way of thinking — finding value in the size of the market, and not necessarily the size of the sale. For a generation that thinks mostly about life rather than death, life insurance can be a challenging conversation. Agents are moving away from traditional industry terminology and centering their conversations on life, living benefits and value.

Advisers have found a way to tap into this younger audience and spark conversation surrounding a product that is anything but racy and errs on the side of practical. Building a business one case at a time, advisers are helping millennials leverage market innovations to find a policy right for them. With a toolbox at their disposal, success is attainable, and the early adopters stand to win. Automation, digitization, developing an online presence and fostering a multigenerational business are just some of the tools today's life insurance agents have used to find a sweet spot in this marketplace.

To adapt to the changing marketplace and growing presence of younger clientele seeking life insurance policies, today's advisers should resist the current, roll up their sleeves and get out their smart phones. Going down-market to find success can translate into a more lucrative, market-driven business — one that will help today's younger generations prepare for a more secure financial future.

Andrew Bucklee is head of insurance solutions distribution at Lincoln Financial Group.

0
Comments

What do you think?

View comments

Recommended for you

Upcoming Event

May 16

Conference

Chicago Women Adviser Summit

The InvestmentNews Women Adviser Summit, a one-day workshop now held in six cities due to popular demand, is uniquely designed for the sophisticated female adviser who wants to take her personal and professional self to the next level....

Featured video

INTV

Why advisers are pessimistic about the economy

Deputy editor Bob Hordt and senior research analyst Matt Sirinides discuss a recent InvestmentNews survey of advisers, most of whom see a recession ahead before the next presidential election.

Recommended Video

Keys to a successful deal

Latest news & opinion

Advisers throw cold water on FIRE movement

Millennials love it, advisers don't: Turns out, extreme early retirement is a suitable goal for almost nobody.

10 universities with the most billionaire alumni

These 10 American schools have the greatest number of alumni who are billionaires.

Top-performing ETFs of 2018

The markets took a beating last year, but these exchange-traded funds bucked the trend

Morningstar says investors rushed the exits in 2018

Net flows into mutual funds and ETFs were the lowest since the 2008 financial crisis, while money-market funds captured inflows.

Widow awarded $4.2 million by Finra panel for theft by ex-Royal Alliance broker

The former broker, Gary Basralian, earlier pleaded guilty to theft and is facing up to 20 years in prison.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print