Millennials and Gen Z Know They Need Life Insurance — So Why Aren’t More Buying It?
Written by
Laura Bogart
Edited by
Cory Dudak
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When we’re young, we’re likely more concerned with building our careers, finding our dream homes and even planning Instagram-worthy travel moments than we are with acquiring the right life insurance.
Indeed, the 2023 Insurance Barometer Study, conducted by insurance education organization Life Happens and the research organization LIMRA, showed that while 52% of all adults owned life insurance, Gen Z and millennials slightly lagged other generations. According to that same study, about 48% of millennials and 40% of Gen Z had life insurance.
However, these groups are aware that they need life insurance, with 49% of Gen Z acknowledging the need to obtain or increase existing insurance, and 47% of millennials drawing the same conclusion. It begs the question:
Why isn’t this knowledge translating into purchasing power?
For starters, many members of younger generations are still unaware of the actual logistics of life insurance, including the cost.
Per Life Happens, roughly 55% of adults in Gen Z and 38% of millennials believed that life insurance for a healthy 30-year-old would set them back at least $1,000 a year–instead of the much more affordable cost of about $200 a year. One could forgive that overestimation of the fees for life insurance, though, given a general climate of financial uncertainty causing anxiety about expenses. According to InsuranceNews.net, young people show more concern about their finances and overall job security, with fears amped up by social media.
To reach millennial and Gen Z customers, insurance companies must break through the digital echo chamber. Younger consumers are used to making social media their first stop for all sorts of questions, from what’s for dinner to how to invest. Two-thirds of people aged 18-42 turn to YouTube to learn about finances, followed closely by Instagram, Facebook and TikTok, as well as LinkedIn. Insurers looking to be the beneficiaries of these generations’ need for greater life insurance coverage would be wise to target them across multiple social media channels, simultaneously.
That outreach should include insurance education. Many young adults, including roughly 42% of millennials, believe that the life insurance their employer provides will meet their needs — though evidence shows that it might not be enough coverage for a family. The study also shows that lack of knowledge about insurance choices, and which one is best for them, prevents a quarter of millennials and members of Gen Z from buying insurance.
With most young people preferring to shop digitally, ensuring that consumers can research, purchase and review their policies online also opens the doors to more millennials and members of Gen Z buying insurance. Consumers in general want assurance that their information will remain secure, and younger shoppers are no exception: 45% of Millennials and 42% of Gen Z have expressed concerns about privacy when purchasing life insurance.
Reaching this key demographic with accurate information about the value of life insurance requires some creativity, but the good news is that the message is likely to be well received.
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