New research from PayPal Australia has found that insurance companies could be missing out on revenue opportunities by not meeting the user experience expectations of young Australians, with only nine per cent of Gen Zs feeling insurance companies are in touch with the needs of young people, when compared to online retailers.
Despite Gen Z having high ownership levels of insurable products such as laptops and smartphones (88%), TVs or consoles (72%), cars (66%) and pets (48%), they are the least insured generation, with almost one-in-five (19%) having no insurance at all. For those who do take out insurance, they are least likely to do so at the time of purchase, potentially because more than a third of Gen Zs (37%) feel that insurance companies have clunky websites when compared to the online retailer's they engage with.
After cost, winning the Gen Z audience is all about the consumer experience. Young Australians will consider switching to a new insurance provider if they communicate in simple, easy to understand language (54%) and offer the opportunity to purchase within a few clicks on their smartphone or laptop (21%).
“Australian insurance companies are missing out on a premium when it comes to Gen Z” said Peter Cowan, Managing Director, PayPal Australia. “This is a generation synonymous with technology, who are now taking their place in the working population and organisations must ensure they have the digital capabilities to create that frictionless, personalised experience these young consumers demand.”
When it comes to paying for insurance, most young Aussies (18-25) with insurance use debit cards (47%) but a significant portion (29%) pay for their insurance with PayPal and (16%) say they would prefer to pay for their insurance via PayPal, ahead of credit cards (13%) or BPay (7%) which are popular amongst older generations.
“The insurance industry is ripe for digital innovation and having the right payments setup in place is critical in achieving this,” continued Cowan. “At PayPal we help organisations streamline their front and back-end commerce founded on insights from our global network across millions of consumers and business customers to achieve a frictionless customer process.”
About the research
This research report was produced by PayPal Australia Pty Limited, based on a study conducted by ACA Research with n=1,020 consumers. It contains general observations about insurance trends, and does not take into account the objectives, situation or needs of any specific business or individual. The consumer research conducted by ACA Research consisted of a 5-minute online survey of n=1,020 Australians aged 18 – 75 years, exploring their attitudes and behaviours around insurance products and providers. The sample was weighted by age, gender and location to ensure data was nationally representative. Significance testing was conducted at a 95% confidence interval, with a potential sampling error of 3.1%. Numbers may not add to 100% due to rounding. The research was carried out in compliance with the TRS Guidelines and National Privacy Principles. The sample was sourced through a consumer research panel, with participants incentivised for completing the survey. Generational Ages: Gen Z (18-25 years); Gen Y (26-41 years); Gen X (42-57 years); Baby Boomer (58-75 years).
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