...."Protect yourself at all times"
Wow! Wow! Wow! – I am three weeks into my new relationship with the wonderful team at LifeSearch and how enlightening it has been.?
Depending on which set of statistics you read there are as many 17 million Millennials in the UK and staggeringly as many as 92% of them live their lives with no income protection at all. Added to that only 25% of them have any form of Life Protection (much of which provided as part of an employment scheme)
So why do I find this so staggering??
Because as a generation they are uniquely exposed!
Let’s look at some interesting facts about Millennials?
1.?????They are now the most influential cohort of people in the UK with spending power somewhere around ￡1 trillion.
2.?????They are the first generation that in real terms have less disposable income than their parents
3.?????55% of Millennials say they have no financial plan
4.?????They pay on average 45% of their income on rent
5.?????When questioned 8 out of 10 Millennials over-estimated the cost of Life Insurance
6.?????Two thirds of Millennials save nothing each year
7.?????66% of Millennials say they have lost sleep over financial issues.
All of this adds up to some serious financial exposure.
These problems aren’t the exclusive property of Millennials themselves; these problems aren’t good for the protection industry as a whole. Socially we need more consumers to be insured and protected. If not the consequence of increasing uninsured liabilities can put additional pressure on the economy.
领英推荐
Why are Millennials not protecting themselves?
If we set aside the economic pressures, we are all experiencing at the moment I believe that the Millennial generation would buy more protection if we made it easier!?
By easier I mean simpler and faster to buy, more digital buying and management options and products that are relevant and easily understood.?
How do we do that?
Embedded insurance and protection are at the forefront of our industry's discussions, and I believe that working with brands that Millennials feel are their own and can trust could make the discussions more comfortable.?
Added to that the ability to utiliise large volumes of proprietary data (that these modern ecosystems have acquired and understand) could aid risk analysis and therefore development of more modern products.?
We also need to explore the marketing and narrative of the products on offer. For example, if we were discussing Lifestyle Protection rather than Income Protection with a young couple living in an expensive apartment with little (or no) savings would the discussion be different?
Also there is little or no point expecting young, talent professionals to buy protection for their lifestyle if it is structured in such a way that if / when they need to claim they are unable to do so for months.?
Most young professionals would back themselves to be re-employed within a few months in the event of losing their jobs, especially when they live in overemployed areas of the country. What they need is quick, short-term support.
The potential for new distributors (embedded partners) to deliver unique, useful products to their customers is huge not just in terms of incremental revenue but also in its consumer ‘stickiness’.
So, as I enter this new world, I am full of excitement and opportunity at what lies ahead. I fully expect that some of my most intelligent and esteemed contacts within the industry will now be shouting…??“It isn’t that simple!”. Trust me I don’t’ think it is either
However, what is the alternative? Doing nothing isn’t a strategy and we can all benefit from a more protected population.
I would love to hear what you think, and I would love to discuss these opportunities with potential distributors and manufacturers.
Remember - "keep your hands up!"
Head of New Business & Growth
1 年Really interesting Edward Axon. Many of the insurers have tried to rebadge Income Protection so it appeals to new audiences but even though IP sales are holding up better than life, there hasn't been a real breakthrough with new audiences. The friendly societies have led some great product changes & with many budget plans out there it's much more affordable than it used to be. I would say however that to GROW the market underwriting must be easier and the product itself must appeal even more so its useful while someone is working not just when they are claiming. The additional benefits don't go far enough. How do we make Income Protection truly fashionable?
Living at the edge of Insurance & Technology | Managing Director, Head of Global Insurance at Google Cloud | #makeinsurancelovable
1 年Its a great debate, however the challenge always here remains around the importance of what I put first. What can I afford and when? how do i best priortise. Would love to see the hierarchy of needs here, is this ahead or behind building a nest egg. It also depends on life stage/event. Do I have a. mortgage, family other commitments etc.
CEO, Lifesearch and Advisory Board member t+1
1 年Great points Edward Axon, and how you ‘protect your income’ means something quite different for our many customer groups. There is a lot of thinking being done on how we make protection more relevant. Katie Crook-Davies Justin Harper Scott Cadger
Head of New Business - Corporate
1 年Some great thoughts here Edward, and great to hear you're enjoying the new role. I think your point around distribution is particularly interesting when viewed with your stat around wages spent on rent. How many of the traditional ways of selling protection products are being squeezed because this population don't bank with traditional players, they don't have mortgages (another obvious discussion point) and they are waiting longer to have children. I agree with you that this isn't a simple fix, but your point is so true, that doing nothing definitely isn't the right answer.