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Sunday, December 10, 2023

How Gen Z will shape the future of insurance

Igloo, a regional insurtech providing people-first and simple insurance solutions, is leveraging upcoming technologies like blockchain and Artificial Intelligence (AI) to protect underserved segments across Southeast Asia against emerging risks and needs.

As part of its mission to provide “Insurance for All,” Igloo unveils how Gen Z (which management company McKinsey defines as people born between 1996-2012) will shape insurance in the near future.

By 2025, McKinsey suggests that this segment will make up a quarter of Asia Pacific’s (APAC) population, making them a big driver of the economy. In the Philippines in particular, around 40 million Filipinos are considered to be part of this segment.

Gen Zs continue to seek tailored insurance for modern lifestyles

Known for being true digital natives and digital savvy, this generation’s preference for speed and convenience, and different lifestyles open a new door filled with opportunities for the sector to tap into.

The insurance industry is changing rapidly with the arrival of Gen Z in the workforce. Speed and convenience are now crucial, and the industry must understand evolving consumer preferences to stay competitive.

In today’s digital age, convenience and speed are paramount, with everything accessible at the click of a button. This demand for efficiency has spurred the growth of insurtech, which leverages innovative strategies like embedded insurance to seamlessly integrate insurance products into the buying process.

This shift is further enhanced by trends like accelerated underwriting and digital assistants, enriching the overall customer experience.

Igloo offers 360-Degree Phone Protection and Travel Master with COVID-19 coverage in respond to emerging online threats

Igloo, through strategic partnerships with major players such as Lazada, Shopee, DANA, GCash, and Circle K, embeds insurance products in diverse distribution channels. Notably, they introduced Southeast Asia’s first convenience store insurance with Circle K.

One significant hurdle for Gen Z consumers is the lack of personalization in traditional insurance policies, leading to higher costs and irrelevant coverage. Gen Z, price-sensitive and willing to share personal data for customization, presents an opportunity for personalized products. Usage-based insurance, exemplified by stackable microinsurance, empowers consumers to tailor coverage to their preferences and budgets, bolstered by technologies like IoT, 5G, AI, and big data.

Emerging threats, including online shopping fraud, data breaches, and device protection, prompt Gen Z to seek tailored insurance for modern lifestyles. Igloo responds with innovative offerings like 360-Degree Phone Protection and Travel Master with COVID-19 coverage.

With the rapid arrival of Gen Z in the workforce, speed and convenience become more crucial

The APAC region, driven by developing economies and a burgeoning middle class, exhibits strong demand for affordable insurance. Igloo addresses this demand by introducing products like 360-Degree Phone Protection and Travel Master with COVID-19 coverage.

Moreover, insurers are now addressing non-human risks, such as pet health insurance, recognizing the growing pet ownership in countries like Indonesia, Vietnam, and the Philippines.

Gen Z, valuing credible brands that align with their values, emphasizes sustainability and diversity & inclusion in their purchasing decisions. Insurers must consider these factors, especially in emerging markets like Southeast Asia, where the underinsurance gap is substantial.

Insurers must also adapt to the digital-savvy Gen Z consumer, who extensively researches products like insurance. Creating clear unique selling propositions (USPs) is crucial to standing out in a competitive landscape.

Igloo’s mission is to make insurance affordable and accessible, identifying emerging risks and solving them through technology and strategic partnerships. Understanding cultural and behavioral shifts is key to increasing insurance penetration in the region.

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