Insurers must resolve long-term problems to successfully sell to younger generations

Insurers Targeting Younger Generations Must Address Industry Challenges

Insurers targeting younger generations face longstanding industry issues of a lack of understanding and a lack of consumer trust, a recent GlobalData poll has revealed. While implementing quick fixes such as social media strategies and offering more flexible products may provide some relief, these solutions are only temporary and will appeal to a small proportion of the target market. To truly connect with Gen Z and millennials, insurers must address the more long-term issues at hand.

The poll, conducted by GlobalData on Life Insurance International in Q1 2025 with 174 respondents, found that over 50% of participants identified either a lack of understanding of insurance or a lack of trust in insurance providers as the primary challenges in selling insurance to younger generations. Despite their digital savviness, simply upgrading digital platforms and social media strategies will not be enough to win over these consumers.

One recurring issue for the industry is the lack of consumer trust, exacerbated by rising premiums across some personal lines. To regain trust, insurers must focus on increasing the value and engagement they offer to customers. Communicating the value of insurance policies, especially to young people who may view insurance as a mandatory expense, will be a challenge. However, incorporating modern features such as nutrition and fitness plans, smartwatch discounts in health insurance, and smart home devices in home insurance can help increase interaction and demonstrate the value of insurance.

Another obstacle insurers face is a lack of consumer understanding. Many young people struggle to grasp the value of insurance and the complexity of product structures. Insurers are often criticized for having lengthy and convoluted terms and conditions. To combat this, some providers, like US startup Lemonade, have prioritized simplicity by using plain language and making policy terms easier to understand.

These poll findings should serve as a wake-up call for insurers, highlighting the need to improve the perception of the insurance industry among younger generations. Addressing long-term issues such as consumer understanding and trust will require more than just PR and social media strategies. Insurers must prioritize increasing engagement with customers, simplifying policy terms, and adding value and incentives where possible.

In conclusion, insurers targeting younger generations must focus on resolving long-term issues to successfully sell to this demographic. By prioritizing consumer understanding, trust, and engagement, insurers can build lasting relationships with Gen Z and millennials. It is crucial for providers to go beyond superficial fixes and invest in strategies that resonate with the values and preferences of younger consumers.

This article was originally published by Life Insurance International, a GlobalData owned brand.