15 Jul 2021
Posted in Insurance
Insurtechs should prioritize affordability and flexibility to appeal to younger homeowners, says GlobalData
The home insurance market among younger generations is ripe for disruption and insurtechs that can offer cheap, flexible and digital policies are most likely to be successful with those aged 30 and younger, says GlobalData, a leading data and analytics company.
GlobalData’s 2020 UK Insurance Consumer Survey found that close to half (45.8%) of the respondents aged 30 and younger have no form of home insurance. This represents a significant difference on the overall market uptake, standing at just over three quarters (76.8%). Furthermore, GlobalData’s survey also showed that adults aged 18-30 were particularly likely to purchase home insurance through a price comparison website (PCW). The proportion of adults under 30-year-olds purchasing through PCWs was 35.4%, while 24.8% of all respondents used this channel. This indicates that they are driven heavily by value and look to find as cheap a policy as possible.
Urban Jungle’s new policy, launched with digital insurer Wakam, prioritises value, but also offers other benefits such as being able to pay monthly and stop coverage at any time. This should therefore suit this age group perfectly.
Ben Carey-Evans, Insurance Analyst at GlobalData, comments: “Paying premiums monthly gives consumers a much more manageable fee to pay, and leaves them less committed to the product, as they can switch or cancel anytime. This is also likely to be a benefit to renters whose living situation can change more quickly, as Urban Jungle allows consumers to switch seamlessly from its renters’ policy to this one aimed at young homeowners.
“Insurers are always searching for successful ways to bring younger generations into the insurance market, and the growth of generation rent has made this harder in recent years. GlobalData’s data highlights that over half of those under 30 do not have home insurance, indicating that they have a way to go, but this also suggests that the market is ripe for disruption and consequently growth. Young homeowners who often have stretched budgets and manageable monthly payments should prove popular. The key will be to offer cheap, flexible and digital policies, which is what Urban Jungle appears to be doing with this new product.”