As the number of American workers younger than 40 grows, agents and brokers are facing the challenge of how to sell to Generation Y. Born beginning around 1980, this group is projected to comprise 40 percent of the workforce by 2020, representing the fastest growing segment of the population.1 It’s also perhaps the most tech savvy, with 59 percent using smartphones.2
With unprecedented access to information and potential for income growth, Gen Y represents the fastest-growing demographic for life insurance — and a lucrative target group for agents and brokers. Knowing this, sellers can harness the power of technology to speak to Gen Yers in a language they understand and explain why life insurance matters — not just in the future, but now.
Admittedly, many among Gen Y are likely not thinking about life insurance. However, if they die, they may leave behind a financial burden for family members who have co-signed a college, car or home loan. Those family members would be responsible for the debts as well as burial expenses. Buying life insurance early is also a great way to establish financial security, which becomes increasingly important as Gen Yers grow older and begin to raise families. Agents and brokers should advise Gen Yers about the financial value of having life insurance as well as the long-term security and peace of mind it affords.
Gen Y and technology
Gen Yers use technology in almost every facet of their lives. They’re staying connected to their networks 24/7 on their smartphones, tablets and computers via social media channels, and they’re using e-commerce apps and researching products before buying. A recent study found Gen Y is more likely to use brands and services that have a Facebook page or a mobile website (33 percent versus 17 percent).2 Technology and social media are increasingly coming into play and are a crucial part of decision making.
Because technology plays a major role in their lives, Gen Yers will naturally turn to it when the time comes to purchase life insurance. As with any important service they’re considering, they’ll research their options and read customer reviews — and they’ll use technology to do it.
Connecting with Gen Y
Most members of Gen Y who buy life insurance will do so through an employer. However, agents need to make sure the information presented is tailored to their audience. The 2012 Aflac WorkForces Report revealed that only 69 percent of eligible Gen Y workers were offered major medical insurance. And 72 percent of those employees said they would be more likely to take advantage of benefits offered, like voluntary life insurance, if those products were tailored to their personal situations.3
To better connect with Gen Yers, agents and brokers can advise HR managers on how to engage with young employees by using technology that features information in a visually appealing way and is easily accessible and user friendly. Also, the information should be available on multiple platforms, such as tablets and mobile websites, to ensure Gen Yers receive it via their preferred method of communication. Technology like this is more than just window dressing. It provides an interactive learning experience that makes understanding the value of voluntary life insurance more digestible.
Because Gen Yers are still in the early years of their working lives, they are likely budget-conscious. Agents and brokers can use this to their advantage by pointing out the tax savings of voluntary life insurance, since some employers deduct benefit premiums before calculating tax deductions, resulting in lower taxable income. Life insurance can also be an ideal gateway insurance product for this young group because it’s affordable and easy to purchase. In fact, 67 percent of Gen Yers surveyed in the Aflac study said they would purchase voluntary life insurance to better protect themselves and their families, citing the low cost of coverage as a factor.3
Helping Gen Yers protect their financial futures — and their families’ — can make it easier for employers to retain this young workforce by building a more competitive compensation package.
Agents and brokers can increase their level of interaction with Gen Y prospects by using a few simple tactics:
- Tailored communications: Not every generation has the same needs. Effectively tailoring benefits communications to be relevant to Gen Yers means understanding their attitudes and expectations regarding lifestyle and financial security. Create specialized communications plans that highlight Gen Yers’ specific life stage needs.
- Embrace the digital age: Develop a microsite to give Gen Y workers a meaningful resource when it comes to understanding the value of voluntary life insurance. Be sure to link to your social media feeds, such as Twitter, Facebook and Tumblr, to give Gen Y clients a way to contact you for more information. While members of Gen Y might hesitate to pick up the phone to ask questions, they will not hesitate to send you a tweet or write on your Facebook wall. Also, another communication channel to consider is text messaging — a smart tool to stay connected with them. Be accessible and stay active on social media channels and you’ll create valuable connections with prospects.
- Speak their language: When communicating with members of Gen Y, don’t tell them what they should know. Instead, show them the data and let them draw their own informed conclusions. Gen Yers like to learn and make their own decisions — so show, don’t tell. In addition, be sure to include anecdotes from their peers in benefits communications. Gen Y members are more likely to listen to opinions from trusted members of their generation. Finally, don’t be afraid to use low-tech approaches, such as a brochure, to reach your audience. Just make sure it’s written in their language and features pictures and illustrations relevant to them.
Protecting the future
Gen Y will represent the largest generation by the end of the decade. Agents and brokers cannot afford to ignore or undervalue this group, which is increasingly well-educated and moving up the career ladder. Today’s office assistant could be tomorrow’s vice president, so it’s important to create valuable connections with prospects early in their careers. And because this generation is more comfortable with technology than any other, incorporate technology into benefits communications to create lasting relationships with Gen Y. Doing so can ensure they have the information they need to make wise decisions when it comes to life insurance.
- U.S. Bureau of Labor Statistics, “Employment Outlook 2010-2020,” http://www.bls.gov/opub/mlr/2012/01/art3full.pdf, accessed on Jan. 4, 2013.
- 2012 Boston Consulting Group, “Study Highlights Distinctive Buying Behaviors and Attitudes of U.S. Millennials,” http://www.bcg.com/media/PressReleaseDetails.aspx?id=tcm:12-103623, accessed on Jan. 4, 2013.
- 2012 Aflac WorkForces Report, a study conducted by Research Now on behalf of Aflac, January 24-February 23, 2012.