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February 13, 2024 at 05:52 AM
What You Need to Know
- Typical marketing strategies miss many young prospects.
- They may not have experienced the major life events associated with life insurance purchases.
- They could be on TikTok. Really.
As insurance agents, we know that when our customers hear the phrase “life insurance,” they usually think about one thing: death.
For the average American, the purchase of a life insurance policy is viewed solely as a protective measure, a means of providing financial security for the loved ones we leave behind.
What many don’t understand is that life insurance is also a strategic investment that offers financial advantages to policyholders while they’re alive.
Many younger Americans, namely millennials and Gen Z, stand to significantly benefit from obtaining a life insurance policy if purchased sooner rather than later.
While targeting this demographic has historically presented challenges for our industry, advancements in insurance technologies create new opportunities to break through to these younger populations this year.
But what messages should we be sharing with this untapped demographic?
Obstacles to a Younger, Viable Customer Base
There are several reasons why insurers have struggled to sell life insurance policies to younger people over the years.
For starters, the ways we have traditionally connected with potential life insurance policyholders tend to exclude the vast majority of younger Americans.
For example, by primarily focusing on mortgage holders, we fail to promote our services to the millions of younger Americans who don’t yet — or may choose to never — own a home.
Second, insurance companies have never developed a practical communication strategy for engaging young people.
While younger Americans may express interest in acquiring a life insurance policy, our primary method of reaching prospective clients has been through referrals from friends and family.
If, for instance, millennials aren’t discussing their preferred life insurance company over dinner and drinks with their peers, they probably aren’t obtaining this information elsewhere — especially not directly from life insurance providers.
Finally, we’ve had to work to counter the perception among younger people that they’re more invincible than their older peers.
Regardless of a customer’s age, it’s easy to procrastinate the purchase of a life insurance policy.
But delaying is even easier for younger individuals who feel like they have time on their side or face serious student loan debt that demands their financial attention first.
In some cases, younger people even express uncertainty about the world’s future (for a range of environmental, social, and political reasons) and aren’t prone to think long-term.
Although we’ve always faced these obstacles as life insurance agents, we’re at a moment when advancements in technology, communications and marketing efforts are allowing us to push back on these commonly held beliefs.
At the same time, younger Americans are more open to purchasing life insurance policies than ever.
According to LIMRA, nearly 50% of Gen Z acknowledge that they either need coverage or more of it.
At this inflection point, we’ve got the means and opportunity to reach millennials and Gen Z — we’ve just got to be more proactive and creative with how we sell to them.
Younger demographics rely heavily on trust signals and customer reviews.
By using specific and timely messages that are well-crafted, entertaining and easily digestible, we can create educational resources that resonate.
But don’t just take my word for it: Videos with the hashtag #FinTok (short for Finance TikTok) have garnered over 4 billion views, demonstrating a growing appetite among younger generations to increase their financial literacy and confirming social media’s role in knowledge sharing.
While not all TikTok users are younger people, the vast majority are.
This growing desire to learn marks a clear need for insurance agents to transform the ways we offer financial education to our clients and connect with nontraditional policyholders.
It’s no longer such an uphill battle to win customers from younger age brackets, which makes now the right time to evolve our sales approach — with technology on our side.
Three Strategies to Reach Younger Americans
As we redefine our sales and communications strategies to engage younger policyholders, much of what has worked in the past remains relevant.
We still need to sell high-value policies and build authentic, meaningful relationships with our customers.
But in addition, a few new characteristics will become hallmarks of successful engagement with millennials and Gen Z.
Speaking their language: Before we can sell to younger Americans, we have to connect with them on their terms.
This requires updates to our traditional communication and marketing strategies, including the need to embrace a fully virtual buying experience.
Having grown up in the digital age, millennials and Gen Z expect a research and buying process that’s fast and frictionless — even when it comes to purchasing something as important as life insurance.
Gone are the days of connecting with prospective clients in person and waiting weeks (or even months) to secure a fully underwritten policy.
Brandon Ellison is the founder and CEO at 