If you had to name one demographic that's currently rocking insurance, you probably wouldn't say Gen X, the cohort that followed Baby Boomers.
No, the market-changing, industry-disrupting demographic that's currently reinventing expectations and to some extent, insurance itself, is quite clearly millennials.
"Millennials have revolutionized the way we communicate with one another and, in particular, the way businesses communicate with them," says millennial expert, Michael Parrish Dudell, bestselling author of Shark Tank: Secrets to Success. They're ethnically and philosophically diverse. Their buying power is waxing. And they're the largest generation in human history.
Suffice it to say, they're an important yet still evolving market. Which means in turn, that our industry needs to know what millennials want from their insurers, and which earthly possessions mean the most to them.
Experience, convenience, immediacy and personality matter to millennials in the claims experience. (Photo: iStock)
Millennial claims adjusting 101
What do millennials want? Where insurance is concerned, the answer boils down to experience. By that, we mean not only the customer experience, but also the ephemeral life experiences that a particular item represents.
The customer experience that millennials want may be summed up in the convenience of a click: on-demand, sleek, immediate and personable.
It would be shortsighted to assume that's the only experience that matters. Consider this: even though most millennials are highly educated and under-employed (Dudell said, "We're talking to smart people with thin wallets"), they're surprisingly "willing to sacrifice money and things in exchange for experiences."
When millennials file a claim, they're not merely trying to replace a belonging. They're seeking to recover a facet of who they are and how they want to live.
Millennials use a lot of technology including smart phones, tablets and gaming systems. (Photo: iStock)
Two takeaways follow:
- First, the customer experience must be a major priority for anyone responding to a millennial claim — which refers not only to speed, efficacy and a smooth resolution, but also to authenticity, respect, self-service and personal connection.
- Second, the items we're paying out for aren't just items. "We value experiences over possessions," said DuDell at Property Innovation Summit.
On that note, which items are we talking about?
No surprise, millennials have a lot of technology in hand. Smartphones, valued in the hundreds of dollars, were to be found among 86 percent of those between 18 and 29 years old in 2015. Seventy-eight percent owned a computer. Sixty-three percent had a gaming system like PlayStation or Xbox. Even MP3 players, whose popularity is declining, were owned by more than half (51 percent) of the group. Millennials own a lot of eclectic devices too, both vintage and bleeding-edge, from turntables to drones.
But while devices like these are important, they're not the only items that a claims adjuster should be prepared to evaluate when working with millennial customers.
What are the most important, and most common, millennial possessions?
(Photo: iStock)
5 of the most popular millennial claims
To tackle that question, here are five of the most common items according to Enservio claims data. The company manages a vast, continuously-updated data warehouse, which it uses to price the replacement value of hundreds of thousands of property items for carrier customers. These results were drawn from claims processed over the course of 12 months, from 2015 to 2016.
1. Jeans – $4.6 million, 100K pairs
While denim sales were hanging in the balance early in 2015, it wasn't for lack of love among millennials, who drove 28 percent of jeans sales at that time. Claims for jeans during the same year averaged $50 a pair. Upscale brands can easily run a couple hundred.
(Photo: iStock)
2. Bikes – $1.4 million, more than 6,000 bike claims
Millennials are riding bicycles more than ever before and their love affair with bikes is changing the urban landscape, according to The G Brief, a publication on millennial habits. On average, bicycle claims amounted to about $230 each.
(Photo: iStock)
3. Sneakers – $870,000, more than 10,000 pairs
Sneakers are stories. They're an expression of holistic living and authenticity. They're wildly popular among millennials. A pair of Gold-Dipped Nike Dunks can run for $5,405. A pittance, compared to Nike Air Force One. Encrusted with an 11-carat champagne diamond, the Big Boi designed footgear sells for $50,000. On average, sneakers cost around $80 a pair.
(Photo: iStock)
4. iPads – $550,000; 1,400 devices
According to PC Mag, "there is a changing of the 'OS' guard happening as younger tech users move into the business world" — a trend that Apple is doing its best to encourage with offerings such as the iPad Pro. The average iPad claim from Enservio data in 2015 came to about $400 per device.
(Photo: iStock)
5. Other tablets – $210,000, more than 900 devices
The iPad may have secured its dominance for the moment, but Windows and Android tablets aren't out of the game. In 2015, 50 percent of those between the ages of 18 and 29 owned a tablet of some sort. Two-in-one tablets, in particular, are gaining popularity. The average claim came to around $230 per device.
Millennials have high expectations and their reasons for filing can be more personal than other insureds. (Photo: iStock)
Best practices for evaluating millennial claims
Responding to a millennial's claim will, of course, involve some of the same standard best practices that a claims adjuster would bring to any claim in the field.
- Common items may be evaluated onsite, while rare or extremely high-value items — a $100K pair of sneakers, for example — may be wise to outsource to a third-party specialist.
- Any documentation that can be obtained should be sought, including receipts, appraisals, COAs and the like.
- Items such as skinny jeans may be evaluated by their brand, line, age and popularity.
- Damage must be assessed to determine the condition of the item and the possibility of restoration.
- Where questions arise, an adjuster should consult a specialist with expertise in the item at hand.
Millennials have a reputation for disruption, one that they've earned to some extent. Their expectations are higher. Their possessions are particular. Their reasons for filing are perhaps more personal, less material, than those of previous generations.
However, on another level, what millennial customers want isn't unfamiliar at all. Like anyone who's experienced a loss, they want to restore a part of their lives that's been shaken, and they want to do so as quickly and smoothly as possible.
Insurers who understand how the desires of their millennial customers are universal, as well as how they're unique, will be in the best position to deliver the experience they crave.
Joel Makhluf (jmakhluf@enservio.com) is a vice president for Enservio and the director of the Property Innovation Summit. Enservio is a provider of contents claim management software, payments solutions, inventory and valuation services for property insurers.
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