Many young adults have a limited understanding of how to manage finances as they transition into independent living settings and the task of buying insurance falls into this category. While younger consumers acknowledge the importance of property, auto and liability coverage, they are looking for more information, often online. This trend provides a new opportunity for agent networks.
Consumers typically look for the following features when selecting an insurance provider:
- Speed of problem resolution: 68%
- Products and services meet individual needs: 67%
- Competitive prices: 65%
- Price transparency: 63%
Because so many operators compete in this marketplace, about 75% of consumers under age 35 are turning to online insurance aggregators to get some answers. These one-stop shopping websites display quotes from a number of different insurance companies. In addition, about 36% of consumers in this age group would also use social media as a research tool when shopping for insurance.
Erik Sandquist, from Accenture — the company that carried out a study on how consumers interact with insurance firms, points out that online behavior exhibited when people shop for travel or electronics products has now spread to the insurance industry. And the opportunity for insurance companies and agents to attract new customers in the younger age group looms large. Accenture data indicates that just over 1/3rd of 18–24 year-olds will be looking for a new insurance provider when their current policy expires.
These days, insurance products are sold through a variety of channels – agents, online and via call centers. Over 80% of consumers expect pricing, service and coverage to be identical regardless of how they contact a company. The good news is that agents can position themselves as experts and charge a premium when selling to younger consumers. Nearly 40% of 18–24 year-olds are looking for personalized advice and service in the insurance purchase process and they are willing to pay extra to get it.[Source: North American Consumers Prefer to Buy Insurance through Agents, Accenture Survey Finds. Accenture.com. 24 May 2011. Web. 2 Jun. 2011]