Insurers must make policies easier to understand and add value and incentives to capture younger buyers, GlobalData says.

A recent study by the business data group found a lack of insurance knowledge and trust in providers are key challenges in selling cover to Gen Z and Millennials, and insurers are associated with long and complicated terms and conditions.

Analyst Ben Carey-Evans says the findings should be concerning to insurers and improving younger generations’ perception of the industry “must be a key priority going forward”.

He says insurers need to increase engagement with customers, and long-term issues such as poor consumer understanding and trust cannot be fixed “simply by improving PR and social media strategies”. 

Rising premiums in some personal lines are “not helping the situation” and communicating the value of policies will be a challenge, Mr Carey-Evans adds.

“Increasing the value and engagement insurers offer will be essential in turning this around. The modern features of some insurance products can provide added value and engage customers.”

Features such as smart home devices that make properties safer are ways to “increase interaction and value” between insurers and customers.