South Africa:More than 80% of millennials polled have life insurance
A survey by the global information and insights company TransUnion shows a generational divide in life insurance coverage with 83% of millennials having life insurance compared to only 65% of Baby Boomers.
This suggests younger people may be more proactive about securing life insurance early on, while older individuals might either have different financial priorities or believe it’s less necessary at their stage of life.
Furthermore, 72% of all respondents had medical insurance, highlighting the importance placed on healthcare coverage across the board, says TransUnion in its “Insurance Trends Survey” report on South Africa.
The survey was conducted in May 2024 with 1,000 South African consumers holding active vehicle and homeowners insurance policies. The study explores evolving consumer attitudes toward online insurance shopping, obtaining quotes, telematics, and policy servicing. The findings shed light on how these trends are transforming the automotive and property insurance sectors.
The main takeaways are:
Most homeowners insurance shoppers preferred to stay with their current providers, valuing continuity. Among switchers, the main drive was seeking cheaper premiums during a challenging cost of living crisis. Some also prioritised better coverage or improved customer service, emphasising these factors in consumer decisions. These insights underscore consumers’ focus on balancing cost savings, coverage adequacy, and service quality, guiding insurers in enhancing offerings for better customer satisfaction. Insurers must adjust premiums thoughtfully amidst the cost of living crisis to retain customers while satisfying their financial and coverage needs.
Respondents’ primary concerns about insurance providers capturing personal identity information is potential misuse and fraud. Other significant worries included sharing data with non-insurance businesses and identity theft. Strengthening data protection and transparent privacy policies could enhance consumer trust.
Most car insurance consumers sought new options primarily due to high premiums. South Africa’s extended cost of living crisis is marked by rising prices and stagnant wages, strained incomes, and increased financial constraints. Despite its perceived importance, affordability concerns have driven consumers to seek better deals or forego insurance altogether, posing a challenge for insurers to provide viable value in a competitive market.
The most preferred method for shopping for car insurance was sourcing comparative quotes online followed by using agents/brokers and insurance company websites. Despite being less preferred, insurance company call centres were the most used method for obtaining quotes.
Over half of respondents switched insurance providers after shopping around, with cost being the primary driver. Additionally, better coverage and improved customer service were key factors for switching. To attract and retain customers, insurers need to focus on competitive pricing, comprehensive coverage, and exceptional customer service. Innovative, flexible offerings like coverage for essential possessions or usage-based insurance can help address financial pressures and prevent insurance gaps.
In the last six months, 64% of respondents were offered car insurance policies with telematics (with a significant 57% opting in), indicating an increasing acceptance of technology-driven solutions for reduced premiums and personalised coverage among younger drivers.
Buying a home, notably among Millennials, drove significant interest in homeowners insurance, showing a clear connection between home purchases and insurance needs. High current rates prompted many respondents to explore alternative insurance options, underscoring financial considerations in insurance shopping behaviour.
Comparative quote websites were the top choice for shopping homeowners insurance, reflecting a shift to convenient online platforms for policy comparisons. Agents and brokers offering multiple company policies were favoured for personalised service and expertise. Insurance company websites and mobile apps, particularly popular among Millennials, reflect a preference for digital platforms in insurance management. These preferences highlight a diverse shopping landscape, underscoring insurers’ imperatives to enhance their online presence and offer robust comparison tools to effectively meet consumer needs.
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