A recent study has found millennials are the least likely of any generation to have any type of insurance including health, auto, renters, homeowners, life and disability.
The survey from Princeton Survey Research Associates International, commissioned by insuranceQuotes.com, found millennials have grown up with overprotective parents, in turn decreasing their level of fear – a fundamental factor for buying insurance.
“Like anyone who’s young, they’re 10-foot-tall and bulletproof,” said Kile Lewis, co-CEO and co-founder of oXYGen Financial, a financial planning firm catering to generations X and Y.
Kit Yarrow, a financial psychologist at Golden Gate University in San Francisco went on to explain, “They tend to be a pretty optimistic crowd, and their view on money is that they're going to be OK."
Approximately, 25 percent of individuals aged 18 to 29 do not have health insurance, double the rate of all other adults. Only 64 percent of Americans in the same age group have auto insurance, compared to an average of 84 percent for all older consumers. Homeowners insurance is purchased by 10 percent of adults under 30, attributable to less Gen Yers buying houses and living at home, but interestingly only 12 percent of the same group of have renters insurance. 13 percent of consumers 18 to 29 have disability insurance, compared with 37 percent of those 30 to 49.
The survey also took a look into the decisions behind millennials being under-insured, concluding misinformation as a dominant influence. For instance, the primary reason (33 percent) consumers’ ages 18 to 29 gave for not having life insurance is they cannot afford it.
Considering these trends, here are three tips for providers when dealing with millennials:
1. Explain policies aren’t necessarily too expensive
The National Association of Insurance Commissioners found the average renters’ insurance policy costs $10 to $30 a month.
2. Illustrate why bare minimum coverage may not be the best idea
For example, buying only the mandatory state minimum amount of auto insurance can open them to financial risk if they were involved in a lawsuit.
3. Point out no one is invincible
Disability insurance replaces part of your income if you become disabled and can’t work. Roughly 1 in 4 of today’s 20-year-olds will become disabled before retirement, according to the Council for Disability Awareness.
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