In this week's Big I Buzz, we are discussing reasons why Gen Z isn't buying life insurance and auto insurance trends found by J.D. Power.

Five Reasons Why Gen Z Isn't Buying Life Insurance

The younger generation, comprising Gen Z and millennials, express a need for life insurance, but many have not taken the step to purchase a policy. Experts discussed five main reasons for this during a recent LIMRA LinkedIn Live event. Firstly, these young adults tend to join the workforce slowly and have accumulated less wealth, making them more likely to use buy now, pay later services. Secondly, they have faced economic challenges due to the financial crisis and the COVID-19 pandemic, leading to higher stress levels about their finances. Thirdly, social media amplifies negative news, contributing to their financial concerns. Despite record-breaking life insurance sales in recent years, there is still a growing gap between the number of young adults who acknowledge the need for life insurance and those who actually buy it. To address this, financial professionals should understand that the younger generation is diverse, digitally savvy, and expects personalized, convenient, and accessible services. Agents need to approach them through various online platforms as they spend a significant amount of time online. Advisors should focus on personalizing online experiences, exploring new ways to educate and market insurance products, and considering embedded life products, wellness programs, immediate smaller purchases, and bundling options to cater to the preferences of Gen Z and millennials.

Auto Insurance Deals Harder to Come By; More Dropping Policies

The latest study by J.D. Power on auto insurance shopping trends reveals a concerning pattern for consumers. With most carriers implementing auto insurance rate increases, finding bargains has become increasingly difficult. Consequently, a larger percentage of drivers are forgoing insurance altogether as premiums rise. The uninsured rate has risen from 11% to 15%, and nearly 30% of those without insurance cited inability to pay as the main reason. As costs rise, insurance falls down the priority list for many consumers, impacting their ability to maintain coverage. The survey also indicates that consumers are growing weary of searching for lower premiums, as the rate of shopping for new rates has decreased. The switch rate, which measures consumers changing insurers, has also flattened, indicating a lack of viable alternatives with lower premiums. Progressive seems to be the main beneficiary of those who do switch, while The Hanover, Amica, and USAA have the highest customer loyalty. The rising uninsured motorist rates are a growing concern, and J.D. Power plans to delve deeper into this issue in future reports.

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