This and other findings have been released in the MetLife Adviser-Client Relationship Report 2018, which examined attitudes to purchasing life insurance through a financial adviser, surveying both current and prospective advice clients.
One of the key findings revealed six in ten (63%) millennials without an adviser could only maintain their current lifestyle for a maximum of six months if they suffered illness or injury. This compares with around five in ten (54%) advised millennials who were asked the same question.
The research found that millennials – defined as those aged 18 – 39 – were the least prepared for the possibility of being unable to work compared with other age groups. It found only one in five (20%) millennials without an adviser have seriously thought about it, compared to almost one in three (29%) of those who receive advice.
Matt Lippiatt, MetLife’s Australia Head of Retail Sales, said there was a clear mismatch between millennials’ level of confidence in their finances and their attitude to insurance. He said millennials care about their life goals, but don’t care about insurance, noting they have a number of competing financial priorities, which he detailed as:
- Reducing education debt
- Paying rent or a mortgage
- Starting a family
“What is clear from these findings is that while millennials believe they are planning well for the future, many are struggling to make the connection to insurance and how it can guarantee everything else they want to do in life,” observed Lippiatt.
In another key finding, the research revealed that, when deciding to actively review their insurances through a financial adviser, the top three triggers for millennials were:
- Purchasing a property or increasing their mortgage
- Wanting to protect their family
- Being referred by someone they know
…among advised millennials, trust is still an important factor
The digital experience, speed and convenience were also found to be key factors when it comes to providing advice services to millennials, where 74% of millennials are open to completing an online form before seeing an adviser. The report, however, reveals that among advised millennials, trust is still an important factor. It says over a third (37%) will conduct their own insurer research after a recommendation from an adviser by visiting the insurer’s website and reading online reviews.
“Faster, experience-oriented service providers have come in and disrupted other industries, and in turn they’ve changed customer expectations when it comes to insurance,” said Lippiatt said.
He said this research demonstrates a clear opportunity exists for financial advisers to have deeper conversations with younger clients about their life goals and insurance needs “…and we know from our research, that millennial consumers want to hear regularly from their adviser too,” he said.
“Millennials are looking for an experience that is quick and easy, and those insurers and financial advisers who can offer digital services and transactions are likely to be the ones that most appeal to this demographic,” concluded Lippiatt.