IQ: Young Insurance Consumers Prefer Networks, Aggregators

Nearly two-thirds (64 percent) of U.S. and Canadian consumers plan to renew or purchase insurance products through an agent in the next 12 months, according to an Accenture survey of 2,500 consumers.

Younger consumers also predominantly favor agent networks—59 percent of 25- to 34-year-olds prefer buying insurance through this channel—almost one-third (31 percent) say they plan to purchase online in the next 12 months.

Respondents said the top criteria in choosing an insurance provider are speed of problem resolution and ability to offer insurance products and services that meet their needs, with 68 percent and 67 percent saying this is very important, respectively. Competitive prices and price transparency were also near the top of the list at 65 percent and 63 percent, respectively.

Consumers' interest in price and price transparency was further supported by the finding that more than half of respondents (55 percent) said they would be interested in using insurance aggregators—websites that compare quotes between different insurance companies. The proportion is even higher for younger consumers, with 75 percent of 25- to 34-year-old respondents expressing interest in doing so.

While the survey found that the use of social media to perform research on insurance products is in its early stages, with 21 percent of respondents using or considering using social media for such purposes, younger respondents again demonstrated much greater interest in this channel. More than a third (36 percent) of respondents under 34 would consider using social media to perform such research.

Among other key findings:

• Two respondents out of ten (21 percent) are considering switching to a new insurance provider the next time they purchase or renew their policy. Younger respondents are more willing to switch providers, with almost a third (31 percent) of those aged 18 to 24 saying they will not purchase or renew their policy with their current provider, or will look around.
• Younger respondents were much more willing to pay a premium for personalized advice or assistance when purchasing insurance products, with 39 percent of those aged 18 to 24 saying they would do so, compared to 23 percent across all age groups.
• Banks are perceived as stronger than insurers with respect to offering financial advice. Respondents said they were more likely to see banks as potential “one-stop shops” for financial services, with 47 percent for banks versus 18 percent for insurers. Also, 39 percent said they see their bank as their preferred financial advisor, versus 13 percent for insurers.
• Consumers seek a consistent experience from insurers, no matter what distribution channel they use. A high proportion of consumers (84 percent) said it is important that insurance products and services be identical across available channels, such as agents, online and call centers.