Engaging with tech savvy millennials is vital to combat HNW underinsurance

BrokerFest 2020: Tony Parker, client service professional at Borland Insurance, has identified four key principles on how to sell insurance successfully to digitally minded professional millennials crossing between the mid net worth and high net worth (HNW) arenas.

Speaking as part of the HNW conference stream at Insurance Times’ BrokerFest event on 11 February, Parker said: “To this group, we’ve got to sell. This group do not trust insurance, they don’t like insurance, they don’t understand insurance, they think it’s expensive, they think it’s not transparent, it doesn’t fit with their digital lifestyle.

“We have some challenges there to overcome to sell to this group. But equally, they do need advice. Insurance is, and should be, always an advised sell; a personalised, bespoke solution for each individual. So, there are some natural clashes.

“This group is the most uninsured in history – they don’t buy insurance because of the themes I’ve just given you. They would rather spend their money on takeaways and Netflix than spend it on insurance.

“As they go through their emerging wealth and gather their wealth, you can see some of their preconceptions, I think, will go with them and we have to work out how we deal with that.”

A principled approach

With this challenge in mind, Parker highlighted four key principles that brokers can use to engage with this millennial demographic. These are early engagement, innovation, customer experience and to develop a unique offering.

Personalisation around life events can be a useful way to tailor insurance for this population, however Parker warned that data gathering needs to be streamlined for them to engage; although this generation are on the whole happy to share personal information, they don’t want to spend too much time doing so – brokers, therefore, need to focus on getting relevant information, fast. Apps, WhatsApp and text messages, could be used here.

Although the insurance sector isn’t known for fast-paced innovation, Parker said that change is now starting to happen. He cited on-demand insurance and monthly policies as an example here.

In terms of the customer experience, this has to be around digital delivery, Parker added. Millennials enjoy using online modelling tools to play with excess and coverage limits in order to take a proactive approach to premium price setting – Parker explained that this can be supplemented with a live chat functionality for a human element.

Discounts and incentives are also useful for regular engagement – Parker described an example where a customer’s monthly premiums decrease if they don’t make a claim.

“What I’ve always liked about high net worth is it always takes a very holistic view; it has to understand the client and all the opportunities that flow from the client, be that their home, their second home, their investment property portfolio, some pets, boats, cars. We do try and take a very good holistic view,” Parker said.