Millennial business owners more likely than Boomers to work with an insurance agent
In an unlikely outcome of the 2008 Recession, Millennial business owners are now the generation most likely to work with an insurance agent so says the fourth annual Business Owner Survey by Nationwide.
Millennial business owners came of age during the 2008 recession—a time of economic crisis marked by uncertainty in financial markets, significant job reductions across the country and a sudden downturn in the real estate market,” said Amy Shore, president of Nationwide’s P&C Sales & Distribution. “For that reason, it’s not hard to understand why this generation is more motivated than the generations that came before them to proactively take steps that satisfy their need for stability. Seeking professional advice intended to position a business for success over the long-term is exactly what business owners stand to gain by working with an agent.”
The Business Owner Survey. In coordinating the study, Nationwide commissioned Edelman Intelligence to conduct a 20-minute, online survey between April 9-27, 2018. Approximately 1,000 U.S. business owners were queried.
What the survey says in images and graphs
Millennials, more than any other generation, also rely on insurance agents for guidance
According to the results from the study, 69 percent of Millenial business owners chose to work with an insurance agent, the largest percent of the three generations now within the workforce. After Millennials, Boomers were the next most likely to work with agency at 66 percent, followed by Gen X at 59 percent. The reason most cited for choosing to work for an agent? It was “…the trust that business owners place on the guidance and expertise from an agent.”
Another interesting trend was in the following categories, Millennials also were the generation most likely to rely on their insurance agency for guidance, even more so than Boomers:
- Retirement (37 percent vs. 26 percent),
- Banking (25 percent vs. 4 percent), and
- Succession planning (21 percent vs. 9 percent)
Other key findings from the survey show:
Use of insurance agents is widespread among business owners.
- Over six-in-ten business owners (63 percent) report having an insurance agent, while almost seven-in-ten Millennials have one (69 percent).
- Business owners with between 100-299 employees are most likely to work with an insurance agent (80 percent), those with fewer than 50 employees are least likely (57 percent).
- Guidance and expertise (41 percent) are the driving forces behind the agent relationship, more so than practical considerations like level of coverage (25 percent) and efficiency (23 percent).
Price is the top consideration when selecting an insurance agent.
- Next in line is insurance coverage/offerings, followed by customer service.
- While trust and guidance are reasons for having an agent, reputation ranks No. 5 on the list of reasons provided by the survey.
Although half of the owners have never filed a claim for their business, 70 percent of Millennials have.
- Half (51 percent) admit to reviewing their insurance policy on an annual basis.
- No universal milestone is driving insurance reviews. Business owners admit to a variety of reasons occurring across various time periods.
- Part of this reasoning may be that business insurance goes largely unused. Half of owners (53 percent) have never filed a claim for their business.
- Boomers have used their coverage to an even lesser extent, as 62 percent have never filed a claim compared to 30 percent of Millennials.
While Millennials are the most technologically connected generation, it seems that they are cautions when it comes to money and still value the importance of a “trusted advisor.” Agents who can harness the innovation coming into the insurance industry with companies like CoverWallet for Agents or Swyft, can meet millennials half way by providing a better customer experience along with the ability to provide a human touch.