The over-50s insurance market is often treated as one segment, but there is huge scope to capitalize upon its diversity by focusing less on age and more on life stage when targeting products and services, according to GlobalData’s latest report: Targeting the Over 50s with General Insurance.
The over-50s market is a growing opportunity for insurance providers. In mid-2015, 44.7% of the UK’s adult population was aged 50 or above, which is forecast to reach 47.6% by 2025, according to the Office for National Statistics. The segment is comprised of particularly powerful consumers. Considering that the over-50s hold the majority of household wealth in the UK according to Saga Investment Services and the Centre for Economics and Business Research.
Danielle Cripps, Analyst at GlobalData, explains: “Those over 50 are often treated and targeted as one segment. However, the over-50s market is highly diverse. Individual lifestyles differ due to a number of factors such as whether they are retired, whether they still have dependent children living at home, their health, and their financial freedom. Age is only relative. Acknowledging this should encourage a move away from targeting the singular ‘over’ segment towards focusing on the different life stages associated with growing older.
“This is important because differences in lifestyle mean that the insurance needs of individuals also differ. The need for travel insurance, for instance, is much greater for an individual who has been able to fund retirement, is time-rich, and has no dependent children or parents to look after. This is in contrast to an individual who is over 70 and is dependent on social care due to a medical condition that limits their mobility, and therefore the capability to travel.
“This realization is something that insurance providers and the general financial services industry must acknowledge and use to develop their products and services to make them more relevant to consumers. It should also be applied to product marketing. Those in their 50s will not regard themselves as old therefore will not be attracted to a generically labeled ‘over-50s’ product. If providers want to sell to these individuals, it is time for product targeting to move away from age towards life stage.”
Within GlobalData’s reports, the over 50s demographic has been segmented into five distinct life stages. This spans across those who still have dependent children in education, to those over 70 who are declining in health. The report explores the opportunities each life stage provides insurers with and how best to target them.
- Information based on GlobalData’s report: Targeting the Over-50s with General Insurance.