What Do Insurance Agents think of Gen Y?

For many agents, Generation Y — made up of consumers in their 20s — is a bit of a mystery. These prospects are probably too young to need products such as long term care insurance or annuities, but they’re old enough that they’re on their own and need some kind of financial guidance. To help figure out how to approach Gen Y and find out what products are right for them, we spoke with three different agents who have worked with that prospect pool in various capacities.

Bill Mills, vice president, SIA Group

1. Do you market to Gen Y? Why or why not?
   We do market to Gen Y, but probably not in as big of a way as we do to other groups because they typically are not business owners. On the personal lines side, we definitely do, but the criteria is not as determinant of age as it is whether you own a home, cars, etc.
2. How do you think Gen Y perceives insurance agents, or those in the financial industry in general?
   I personally think that most Gen Ys feel it’s a generic product that everyone can offer. Their decisions seem to be price-driven, with less emphasis on personal service than the generation before them.
3. On the flip side, how do you think the financial industry views members of Gen Y?
   I think a lot of us view Gen Y as a group that looks at bottom dollar. They want the best price and the fastest turnaround. Generally, they do not seem to be looking to build a relationship. Instead, when they want something, they want it now and feel it can all be done online.
4. What do you think of Gen Y’s potential as sales prospects?
   Gen Ys have excellent potential as sales prospects. If you can get in with them and make that connection, then they are ideal because they will only continue to grow, and you have the opportunity to grow with them as they start a family, purchase a home, build a business, etc.
5. What kinds of sales trends are you seeing in Gen Y? What products are they buying, what products are they putting off, etc.?
   As far as insurance goes, I see a majority of Gen Ys putting off higher limits. They seem to think that they are invincible. Most — not all, but most — do not seriously consider that they may get in an accident, and after that accident, they may be sued. It is this mentality that causes them to stick with lower liability limits.
6. Anything else you’d like to add about Gen Y?
   Gen Y is well-educated as a group, which I attribute to the Internet. They really dig in and do online research before they make a decision. Because of that, online presence [for agents looking to sell to Gen Y] is big, whether it is as purchasing power or an education resource.

Adam Sherman, CEO, Firstrust Financial Resources

1. Why do you market to Gen Y?
   Most of the resulting opportunities [of marketing to this demographic] are assisting young families with protection needs. At Firstrust Financial Resources, we have a more mature clientele, but Gen Y might represent 10 to 15 percent of our business. This group is generally more focused on protection needs.
2. How do you think Gen Y perceives insurance agents or those in the financial industry in general?
   I think Gen Y gets most of their data from the Internet, so they probably struggle with working with an advisor and do not at this point see the value added since they have grown up purchasing financial vehicles over the Internet.
3. On the flip side, how do you think the financial industry views members of Gen Y?
   I think our industry thinks of this generation as the future. They are highly educated, and it will be a struggle for less-astute advisors to provide value to this demographic. Many of the younger advisors in the industry should target this group and demonstrate that they can deliver value.
4. What do you think of Gen Y’s potential as sales prospects?
   I think as they continue to have life-altering changes like getting married, having children, or building a business, we will continue to view them as good prospects.
5. According to ASJ’s 2009 Independent Brokerage Study, the average age of an insurance agent is 55. Do you think that can cause some communication problems or other issues when working with Gen Y clients?
   Yeah, this can affect working with Gen Y. This demographic will probably relate to their peers. Also, since insurance usually has a 30 to 40-year lifespan, working with an advisor who is 55 suggests that they might have to find another advisor to work with in the future.

Joel Ohman, president, HealthInsuranceProviders.com:

1. Why do you work with Gen Y?
   We love working with those in their 20s and 30s because our life and health insurance agency business model focuses on providing clients with instant online quotes, easy comparisons between many different companies, online/phone applications, and other things that the very tech-savvy Generation Y has grown up expecting.
2. What kinds of sales trends are you seeing in Gen Y?
   Gen Yers who are just getting married and starting families of their own are, for the most part, very smart in at least freely admitting that they need some form of health insurance, life insurance, and auto insurance. However, Gen Yers who are single still need the most convincing that they are not invincible and need at least some form of comprehensive health insurance coverage, just as they need auto insurance and may someday need life insurance.
3. What do members of Gen Y look for in an agent?
   In addition to being naturally tech-savvy, Gen Y also has come to expect instant answers to their questions. Agents who can immediately give a potential client exactly what they are looking for in the exact medium that the Gen Y searcher has come to them in will be leaps and bounds ahead of “old-school” agents who insist on manually running proposals, scheduling a face-to-face meeting before giving personalized quotes online and over the phone, etc.
4. What tips do you have for agents who want to start marketing to Gen Y but don’t know how to reach them?
   One of the biggest things to understand about the Gen Y market is that Gen Yers almost always have shopped around and done their research online before contacting you. This is a good thing if you are an agent/agency with a strong online presence and that is comfortable helping Gen Yers get answers to their questions via the Web, phone, email, etc. This also means that a smart agent will take the time to proactively educate Gen Yers about various insurance products and open a discourse about some of the flat-out wrong information that they may have stumbled across while doing their research online. An agent who can position themselves as an expert in their particular niche and is able to convincingly communicate their expertise in an almost professor-like manner online and over the phone will easily win the trust of many Gen Yers.

To find out how Gen Y views insurance agents and the financial industry, and get a taste for their economic preparedness and willingness to purchase insurance products, check out our April national print edition for the feature “Insurance Agents: Meet Gen Y.” Get your free subscription today!