Why won’t they buy?

Millennials are rapidly becoming the largest group of spenders, who are focused on shopping for experiences over purchasing random products. Furthermore, reviews of Gen Z buying patterns and their preference for online purchasing, indicate that the demand for experiences is only going to grow.

Now is the right moment for e-businesses to catch the wave and boost ancillary revenues, by offering millennial-ready insurance experiences with products that protect consumers from unexpected events, provide support when things go wrong and offer immediate compensation with no claim required.

But are today’s insurance products geared to the demands of consumers? Are millennials buying insurance?

Take travel-related insurance products as an example: The travel industry has evolved to meet the modern consumer’s demands for unique, delightful and exciting holiday experiences. Just last year, British holidaymakers have travelled more than any point in the past five years, with new destinations and niche, authentic experiences becoming the norm. Nevertheless, traditional insurance products offered to millennials, are not in line with their expectations for a personalised, reliable and hassle-free insurance experience.

From consumers’ viewpoint, existing insurance offerings:

• Oftentimes fail to address their real risks and concerns.
• Entail reviewing complicated and unclear insurance policies.
• Require a long and frustrating claims process.

This is why millennials avoid purchasing protections, such as insurance against flight delay and cancellation, missed connection, bad weather and lost luggage. In fact, according to ABTA, 25% of holidaymakers travelled abroad uninsured in 2017, which was an increase from 2016. And as many as 38% holidaymakers travelled abroad in 2018 without suitable travel insurance or any insurance at all.

How can this trend be reversed, how can e-businesses cash in on the opportunity and grow?

E-businesses are uniquely positioned to deliver their consumers a new insurance experience. This means no more one-size-fits-all products offered in the customer journey by third parties; no more ambiguous policies or claims processes. Instead, e-businesses should adopt insurance platforms that leverage technologies like parametric insurance, AI and machine learning, enabling them to create simple protections that are tailored to consumer’s individual needs and generate automatic compensation.

Turning insurance into products millennials love is a great business accelerator. Delivering new types of protections will improve the customer journey in general, and travel experiences in particular. This will restore confidence in insurance, positively affect brand reputation and drive millennials to buy.

About the Author
Elana Marom is a full stack marketer who believes that marketing is about being present, relevant and adding value, alongside understanding how customers want to buy and helping them to do so. As Director of Marketing at Setoo, she’s leveraging her extensive marketing experience in start-up and enterprise environments to raise awareness about the paradigm shift evolving in the insurance industry and drive business growth.