Life Insurers’ Courting of Millennials Pay Off
June 26, 2017 by Jay Cooper
Who says life insurers are too stodgy or “boring” for Millennials? Companies have undertaken large-scale initiatives, from accelerated underwriting to souped-up digital interfaces, to appeal to the demographic segment, and it appears those efforts are paying off. New Harris Poll research shows Millennials actually view life insurance more favorably than their Gen X or Baby Boomer counterparts.
This is the 29th year Harris Poll conducted its Equitrend brand study, which measures a brand’s equity by factoring in consumers’ familiarity with a brand, perceived quality and the consumers’ purchasing considerations of its products or services. The depth of the study — at least 1,000 consumers rate each brand — provides a good barometer for how consumers feel about an individual business or broader industry. (Individual brand ratings of life insurance companies in the study were reported earlier this year, with Guardian Life taking the top spot.)
For life insurance, at least when it comes to Millennials, things are looking up: Millennials feel a stronger connection to life insurers, feel more shared values with life insurers and are more likely to trust, consider and recommend life insurance companies than Gen Xers or Baby Boomers.
On a one to 10 scale, Millennials give the industry a 6.9 rating on trust, compared to a 6.4 rating from Gen Xers and Baby Boomers. Millennials also offer a more favorable rating in their likelihood to recommend life insurance, with a score of 6.3, compared to a 5.5 rating from Gen X and 5.1 from Baby Boomers. In a broad rating of their consideration of life insurance companies, Millennials assign a rating of 6.3, compared to 5.8 for Gen Xers and 5.4 for Baby Boomers.
Forty-two percent of Millennials also say they have a strong connection to life insurance companies, compared to 34% for Millennials and 27% for Baby Boomers. Similarly, the Harris Poll shows 33% of Millennials feel life insurance companies “get me,” compared to 22% for Gen Xers and 19% for Baby Boomers.
The more favorable ratings from Millennials come on the heels of considerable investment by life insurers to appeal to the demographic segment.
Guardian Life, which received the most favorable brand rating in the Harris Poll study (the report does not break out ratings by age group) has taken on several projects to engage Millennials. The company updated its tone and voice to speak in a more “human” way, according to a spokesperson. Guardian Life also started publishing customer-centric content online and in social media channels that centers on specific life stages and events. Much of the content highlights the behaviors the audience is experiencing, allowing the insurer to speak “with” the audience, not “to” them, a spokesperson says.
The launch of new social media channels on Twitter, Facebook and LinkedIn has also helped Guardian Life have a better dialogue with clients such as Millennials. Additionally, the insurer has enhanced SEO and SEM programs to increase visibility on Google, with the broad goal of establishing itself as a more authoritative subject matter expert. Those efforts appear to have paid dividends: Organic traffic to the site is up more than 31% from this time last year.
Other insurers have also invested in Millennials. In 2015, Northwestern Mutual acquired LearnVest, an online-based financial planning company with large Millennial appeal. As reported, the company has since promoted several LearnVest executives into broader roles with the company, presumably to ramp up its digital prowess and increase its relevance with Millennials. The promotions include making LearnVest founder Alexa von Tobel its first chief digital officer.
MassMutual has also invested in targeting Millennials. In 2014, the company opened its Society of Grownups. The concept originally included a physical location, with classes mentoring Millennials on financial topics. That location was eventually shuttered, however, and the company made the Society a “digital hangout” that delivers digital and online financial literacy tools to Millennials. The company also launched Haven Life in 2015, with the intent of offering a streamlined solution for buying life insurance entirely online.
The insurer recently undertook a major rebrand and website redesign. Many aspects of the new look have Millennials in mind. The rebrand focuses, in part, on communicating who MassMutual is as a company, and why it provides services such as life insurance, instead of a historical focus on financial guidance and the products MassMutual offers, a spokesperson says in an email. The change in messaging occurred because authenticity and honesty are high-ranking values across demographics, but especially with Millennials.
The multi-channel advertising campaign that accompanied the refreshed brand rollout also went beyond traditional advertising, featuring ads on digital and social platforms popular with Millennials, such as Instagram, Facebook, Hulu and Nucleus.
Two years ago, John Hancock released its Vitality program, which offers rewards and life insurance discounts for healthy lifestyle choices. The program is available for all age groups, but has been touted largely as a tool to improve engagement with consumers. Industry experts say increased engagement is essential to appeal to younger consumers.
John Hancock also recently launched a proprietary underwriting solution that will allow qualified applicants to receive an underwriting decision in as little as three days, bypassing bloodwork or in-person medical visits as part of the sign-up process. Other insurers are also implementing faster, automated underwriting solutions, in large part because Millennials have shown distaste for the long application process associated with obtaining coverage.
Millennials’ improved perception of life insurers comes as the age group is starting to hit an inflection point in purchasing the product. LIMRA data shows 70% of Millennials own some type of life coverage, which is equal to the national average. The uptake represents a 10 percentage point jump from 2010, the largest change in ownership of any age group.
While a jump in brand recognition and sales are encouraging, LIMRA data also points to areas where life insurers could improve their communication with Millennials. The research shows eight of 10 Millennials who don’t have life insurance don’t purchase it because they believe it costs too much or because they have other financial priorities, yet Millennials often grossly overestimate the cost.
