Data from SCOR’s Digital Solutions subsidiary ReMark reveals worrying gaps in financial understanding among Millennials and Gen X. Less than half of people aged 18-42 have a ‘good’ understanding of life and health insurance products, and 11% admit to having ‘no knowledge’ at all.
The report which interviewed 12,563 Gen Zs (18-26) and Millennials (27-42) across 22 different markets – also discovered that digital access to education is key. More than half of young people would prefer to gain knowledge about insurance through online courses, video content, forums and social media.
The study found that less than half (46%) of younger consumers have a good understanding of life and health insurance products, while 11% admit to having ‘no knowledge.’
The most popular way in which Gen Z want to learn more about insurance products is online (53%) – either via an online course (26%), watching video content (12%), through forums (9%), or social media (6%) – while 16% would turn to a trusted friend or family member and 13% an insurance adviser.
The research found that 35% of Gen Z and Millennials said ‘good online reviews’ was the most important factor in their decision to buy, ahead of price (31%) an established brand name (12%) whilst 24% were triggered into buying their most recent life or health product by a personal recommendation.
29% of respondents went online for advice before buying their most recent protection product; 27% went to an IFA, and 27% went to a friend or family member. Meanwhile, 72% of Gen Z and Millennials in the UK are prepared to share wearable data to get life or health cover, 82% would share their previous claim history and 71% would share their medical and mental health history
75% would want a ‘discount on their premium’ as a reward for sharing personal data, while 67% would like to receive retail discounts whilst 55% of Millennial and Gen Zs in the UK feel often or always stressed – compared to 47% worldwide.
Financial issues are the top reason for stress (29%) amongst under 42s, followed by an uncertain future (21%).
Naomi Greatorex, Director at Health Protection Solutions Ltd says the findings of the study are reflected in her own experiences in speaking with younger people, especially renters who are less likely to have been ‘triggered’ into thinking about protection products. She said “In my experience most people have very little understanding of life cover and health products until they have mortgage advice. This means that a large percentage of younger people have no protection advice, and therefore no understanding of the importance of protecting themselves. This is reflected in the amount of people I talk to under the age of 40 that have no idea what life cover and other health benefits offer, particularly if they are renting.”
Gavin Maguire, Head of UK & Ireland, Life & Health at SCOR said “The 10th Global Consumer Study focusses on people aged 18 to 42 to offer insurers unique insight into this hugely important consumer group, and what it has found is that younger people are lacking knowledge, but they want to learn more, and online education is the way they want to do that.”
“The report also reveals that online access to the insurance products themselves is hugely important to young people – good online reviews are the most important factor when it comes to purchase, while social media is playing an increasingly important role, with one in ten (10%) saying it was social media that triggered their most recent life or health insurance purchase.”
“However, there is a fine line – the report also suggests that spending too much time on social media may be a contributing factor towards major stress for young people. The key takeaway here is that insurers need to recognise the importance of a strong digital presence – enhancing online reputation is going to be key for life and health insurers and brokers looking to tap into a younger market.”