A survey of personal-lines insurance customers indicates that insurers and agents need to focus on the younger generation of buyers to grow market share, or risk losing this generation to online-only writers.
Consulting firm Deloitte released a 23-page report detailing the results of an online survey of 1,080 auto policyholders and the same number of homeowner's policyholders, exploring their relationship with personal-lines insurance markets.
Deloitte says a key lesson from the report, titled "The Voice of the Personal Lines Consumer: Buyers in the Driver's Seat," is that insurers need to "get consumers while they're young."
The younger generation (aged 34 and younger) is more willing to shop personal-lines insurance frequently and buy from direct carriers, the report says—an inherent challenge for agents and brokers.
The survey found 20 percent of those 18-25 and 26-34 had changed auto carriers in the prior 12 months, while 10 percent of those 51 and older had done so.
Over the previous two years, 15 percent of the two younger-generation groups went for a new insurer, while only 9 percent of the 51-and-over group had done so.
The survey revealed further bad news for agents when it comes to younger buyers.
While a greater percentage of buyers over the age of 50 said they would not buy insurance without an agent (34 percent for auto and 29 percent homeowner's), that percentage was well under 20 percent among younger buyers.
Additionally, that number got as low as 5 percent for those below the age of 26 who purchased homeowner's insurance.
Among the many factors that influence buying, trust is a big one—"and it is an attribute in short supply in the view of many respondents," the report says. A strong brand, it adds, can help draw consumers away from the competition.
So while price does remain the biggest consideration for shoppers, the fact that trust is also an important factor does give producers some insight into at least one effective marketing angle they can use to compete against the strong appeal of an instant online quote.
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