Although first appearing in the 1991 book, ‘Generations’, authored by Neil Howe and William Straus, ‘Millennial’ is a term frequently thrown about in todays’ world.  Whether it’s how to market to them, employ them or manage them, our 21st century society has developed a love hate relationship with this generation.

Born between 1981 and 1996 (although these dates are open to some debate), millennials make up 31.5% of the total global population.  

Characterised by a kinship with computer systems, digital interfaces and above all the internet, this is a generation underpinned by the growth of technology.  As a result, they adopt new applications quickly, are better at multitasking and more open to different forms of thinking, when compared to previous generations. 

But how does this affect things when it comes to buying home insurance?  What does being a millennial have to do with it?

Despite being seen as modern day necessity, home insurance hasn’t evolved to meet the technology filled, fast paced lifestyles of today.  This, coupled with a changing property market and increased cost of living, has left many millennials severely uninterested and uneducated on why home insurance might be of use, instead viewing it as an expense they’d rather not commit to and a product they’d rather ignore.    

 

More people renting – Less people buying homes

With generation rent in full force, it’s no surprise that millennials are far less likely to be homeowners than their parents. In fact, according to the Resolution Foundation, one in three British millennials will never own their own home.

In addition, with the memory of the 2008 UK Housing Crisis still fresh in millennial minds, this is a generation wary of the perceived ‘security’ of big investments in which an unstable societal climate means sound decisions become inescapable burden, and with property commitments being seen as more risk than a comfort. 

 

Cost vs. Expectations

As said before, today’s social climate can make saving for the future a tough feat. Whether it be for retirement, a deposit or even an emergency fund, the amount you need to put away for financial freedom can come to a pretty daunting figure.  This is especially true for millennials, who have felt the brunt of dwindling saving account interest rates, slashed state pensions and increased living costs.  

Not only have these factors resulted in extra money leaving millennial bank accounts each month, the added anxiety has resulted in an unwillingness to spend altogether. So when it comes to home insurance, the idea of ‘forking out’ for some additional protection doesn’t even come to mind. 

And with less people on the property ladder than ever before, millennials may associate home insurance with more traditional ideas of homeownership.  Meaning they believe that ‘if I don’t have a house, I don’t have enough stuff to make insurance a worthwhile expense’, furthering the idea that home insurance is an unnecessary expense. 

 

Don’t have the time – Don’t know what to expect 

With ‘What is an Insurance Premium?’ accumulating a whopping 354,000,000 search results on google, it’s obvious that a lot of people are confused when it comes to home insurance.  

A fact which isn’t helped by ambiguous, often sales driven, information coupled with endless paperwork and hard to understand policy details.  What’s more, for time poor millennials, wading through this confusing insurance wasteland can seem like an insurmountable task to take on. 

 

Sceptical of Claims 

With the popularity of programs like ‘Rogue Traders’, ‘Cowboy Builders’ and ‘Panorama’, UK millennials are all too familiar with nightmare tales of hellish customer service. As a result, they have learnt to be sceptical of organisations and the promises they claim to stand by. 

This is often the case when it comes to home insurance.  With many millennials believing they’ll never receive the compensation they deserve when making a claim. Instead, they fear that making a claim will result in being treated like a criminal, entering into an endless fight over whether they even owned the item (or items) in the first place. 

With this taken into account, it’s no wonder millennials view home insurance as an unreliable, unnecessary expense; one that doesn’t reward customer loyalty or have their back when things go wrong. 

 

Don’t think their stuff is worth protecting

With the rise of technology, you’d be hard pressed to find someone who doesn’t own a smartphone, laptop or smart TV. Whilst these products make our daily lives a little easier, their common place nature has lulled us into a false sense of security when it comes to their value.  

Especially when it comes to millennials, who’s growth has mirrored that of technology, familiarity with these products has led to them not being seen as big investments, in turn fuelling the belief that these items are not worth insuring in the first place.  

In addition, with growing technology in the workplace, work phones and work laptops are frequently becoming a common occurrence. Whilst some of these items are covered by company insurance policies, there’s often a lot of debate around how these items are protected. 

As a result, many millennial employees may not know they are responsible for protecting these gadgets or the repercussions they could face in cases of damage or loss, unaware that taking out home or contents insurance could prevent them from replacing these items ‘out of pocket’ if anything goes wrong. 

 

The future of home insurance: Changing to suit millennials 

So, with all that said, how can traditional insurance evolve in order to cater to millennial customers? And what does the future of home insurance look like with their specific needs in mind? 

Firstly, traditional insurance has to change its offering.  Not only will millennials hold greater interest in niche products, such as bike insurance, but the importance of contents insurance to this homeowner scarce group should not be ignored – especially when so many already live in properties with existing buildings cover (i.e. their parents policy). The ability to insure fewer items, such as a laptop, phone or camera, will allow millennials to enter into home insurance much sooner than they believed necessary.  

In addition, the transparency and accessibility to all kinds of insurance needs to change, with a greater focus on customer empowerment and education.  Both products themselves and the experiences surrounding them need to serve customers on a level they haven’t done so in the past. That means solving user issues on a much more individual basis, with personalised cover, intuitive interfaces, re-imagined claims processes and fantastic customer service. 

What’s more, home insurance cannot shy away from technology if it wants to capture millennial audiences. Not only will embracing tech and digital modalities boost accessibility and ease of use, providing smarter services with problem solving features built in.  This is a vital step in creating the kind of policies customers crave and deserve, eradicating inadequate blanket cover and providing accurate protection to all. Both video technology and digital interfaces are obvious introductions in this area, allowing customers and companies to verify, personalise and amend policies, whilst offering intuitive solutions to an often ‘nightmarish’ claims process. 

Sound too good to be true? At buzzvault, it’s been our mission to make this future of home insurance a reality and put our customers in control of their cover.  Find out more on our website.