New study: Nearly a quarter of millennials who missed insurance payments forgot they were due
Invoice Cloud’s Millennial Policyholder Report highlights concerns, challenges facing millennial insurance policyholders, importance of online customer experience
BRAINTREE, Mass (February 16, 2021) – Invoice Cloud, an EngageSmart solution and the leading provider of online bill payment services, has just released a report highlighting research into the state of millennial insurance policyholders in 2021. Based on a survey of more than 1700 respondents, the Millennial Policyholder Report highlights that nearly 20% of millennials have missed an insurance payment over the past year. Some respondents among this 20% cited financial issues, but the majority of millennial policyholders who missed payments alluded to problems that could have been solved had their carriers offered automated online payment options. Nearly half of Millennials surveyed cited a superior customer experience as a critical factor in their next insurance carrier.
As older millennials approach middle age (the eldest in the generation are 40 this year), outdated stereotypes pertaining to this demographic as naive and entitled no longer make sense. Millennials have lived through two financial crises, they have families and cars, run businesses, and are homeowners—all of which require insurance. This population has been largely overlooked by traditional insurance carriers, allowing digital native carriers such as Lemonade and others that optimize for convenience and customer experience to gain market share with millennials. Invoice Cloud’s Millennial Policyholder Report aims to illuminate both the challenges facing millennial policyholders and to highlight some of the opportunities for traditional carriers to engage the millennial customer audience.
“People still don’t really think of millennials as old enough to need insurance, which has left them wanting,” said Julie Schieni, VP of Financial Services Alliance Area at Invoice Cloud, “This survey shows that millennials are not only an important market for insurance but that they’re pushing for digital transformation in the industry, which has traditionally lagged behind when it comes to technology advancement.”
Key findings from Invoice Cloud’s Millennial Policyholder Report include:
Online transactions essential to customer satisfaction
The Millennial Policyholder Report found that nearly 20% of millennials have missed an insurance payment over the past year. A portion of those who missed payments said it was due to financial issues, but the majority of millennial policyholders who missed payments cited issues that could be solved by insurance companies enabling automated online payments. Of the 20% who missed a payment:
- 24.05% said they simply forgot a payment was due
- 20.23% said their payment arrived late due to postal delays
- 18.77% said the payment process was too confusing
When asked how important online or mobile payments are when selecting an insurance company, 89.43% of millennials said it’s an important factor in the decision-making process. Additionally, the majority of millennials said they prefer virtual interactions with their insurance carrier when they need to file a claim or ask a question.
- 24.14% prefer to interact with their insurance carrier via mobile app
- 17.13% prefer email
- 14.13% prefer online chat
- 8.82% prefer text message
- 34.37% prefer phone
- 0.45% prefer in person
Beyond everyday communication and payments, millennials are also increasingly choosing to purchase insurance online (23.46%) or via mobile (40.597%).
COVID-19’s influence is significant
Millennials are no stranger to financial crises, the most recent of which has been the recession caused by COVID-19. The Millennial Policyholder Report found that of the 20% of millennials who missed an insurance payment in the last 12 months, 23.17% cite COVID-related income issues and another 13.49% cite financial issues unrelated to COVID-19.
The majority of millennials who missed an insurance payment due to financial issues are forgoing insurance altogether due at least in part to the current economic crisis. More than half (55.2%) said they anticipate going without insurance in the next year due to financial issues. As the insurance needs of this generation continue to evolve, it’s time for the industry to start adjusting to meet their needs.
About the methodology
Invoice Cloud’s Millennial Policyholder survey was conducted between January 11 and January 12, 2021. The sample included 1,769 millennials who own at least one active insurance policy of any type.
About Invoice Cloud
Invoice Cloud, an EngageSmart solution, is the leading provider of online bill payment services. Founded in 2009, the company has grown to be one of the leading disruptors in the cloud-based electronic bill presentment and payment (EBPP) space, helping institutions put customer experience first. By switching to Invoice Cloud, clients improve customer engagement, loyalty, and efficiency while reducing churn and missed payments in the process. With over 2,100 clients across the US and over 50 million payments processed annually, Invoice Cloud is one of the most secure, innovative, and inclusive fintech solutions in the market. To learn more, visit www.invoicecloud.net.
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