How Auto Insurers Can Win Gen Z Drivers
A new generation is stepping into the driver’s seat. Here’s what auto insurance can do to earn their business.
Getting to Know Gen Z
According to Pew Research Center, the cutoff year for Millennials is 1996. Anyone born between 1997 and about 2012 belongs to Generation Z. In 2020, the oldest Gen Z members are about 23.
According to Business Insider, Generation X is set to become the largest U.S. consumer population with 82 million members.
Many Gen Zers are old enough to have a driver’s license, and more are getting their license every day. To appeal to this generation, car insurance companies will need to understand their values and preferences.
Savvy Tech Natives
Gen Zers have grown up with things like cell phones and the internet. They are tech natives who both understand how to use technology and expect to have access to convenient apps and online tools.
According to the Notre Dame of Maryland University, studies have shown that 65 percent of Gen Zers prefer to communicate online more often than in person when at home, and many Gen Zers expect a quick response.
At the same time, Gen Zers have also been exposed to the dark side of technology, including privacy issues and data breaches. According to CBS News, research has found that 63 percent of Gen Zers are worried about privacy and security issues when paying with credit and debt cards online, compared to 58 percent of Millennials.
This does not mean that Gen Zers aren’t willing to hand over their personal data – but they will want something for it. According to a study from SalesForce, 68 percent of Millennials and Gen Zers are open to having companies use AI to improve the customer experience, and 91 percent are more likely to trust companies that explain how personal data is used to improve their customer experience.
So how can insurers appeal to Generation Z?
- Provide apps and online tools.
- Use instant communication methods that include messaging and chatbots.
- Be transparent about how data is used and how consumers benefit.
- Provide secure payment options.
Younger generations are increasingly concerned with social justice issues, and they expect businesses to take a stand.
According to the SaleForce study, Millennials and Gen Zers are more likely than older generations to trust companies that work to protect the environment, provide equal pay, give back to the community, and foster diversity in the workplace.
In a survey of Gen Zers, Deloitte confirmed that Generation Z will not form an opinion of a company based solely on the products and services that it offers – the company’s ethics, practices and social impact will also be a crucial part of the opinion.
This means that businesses seeking to attract Gen Zers can’t stop at providing a great product or service. They must also consider their reputation on social issues.
- Develop a socially responsible brand known for giving back to the community.
- Foster a workforce that embraces diversity and equality.