With so many homes being purchased by younger buyers, use these four tips to attract and retain this new generation of homeowners.
High-end homes continue to remain strong within the real estate market. Yet, the average buyer has changed, creating opportunities for strategic agents. Millennials are moving into million-dollar homes with the cash to support these major purchases.
This is thanks to millennials being the most educated generation in history, having higher earnings than other generations, and being set to inherit more than any prior generation, according to a May 2020 report by the Brookings Institute. Having built-up savings and a desire to settle down, younger Americans are aggressively pursuing homes on the market at $1 million or more, creating the need for flexible insurance coverage that provides powerful protection for these high-end homes.
As these young adults move into their first homes, these individuals acknowledge that they could use help when it comes to purchasing homeowners insurance protection. Sixty-one percent of millennials agree it would be helpful to have an experienced agent review their personal insurance to make sure they have the right coverages in place, according to a recent survey conducted by The Hanover and OnePoll.
Unfortunately, the survey also found that millennials are less likely to have established, trusting relationships with an independent agent. This is a large demographic that has been underserved and under-protected, yet, they are looking for a strong customer experience. With high asset levels, this group needs consultation with agents the most.
These findings point to a growing opportunity for agents to offer enhanced customer service consultations that will help these new homeowners protect their investments while growing their businesses.
With the increasing need for personalized insurance offerings, here are four tips for independent agents looking to attract and retain this generation of high-end home buyers:
1) Boomer referrals. Existing baby boomer clients can provide great referrals for their children or their younger colleagues. This demographic has typically been serviced by and highly satisfied with independent agents for decades and can pass on the wisdom of asset protection to the next generation.
Consider targeting this audience with educational information for them to share with friends and family on the benefits of working with an independent agent.
2) Industry partnerships. Investment planners typically have life-long partnerships with their clients and can be a strong referral source for independent agents looking to secure high net-worth clients.
Consider reaching out to these financial advisors to build relationships and explain the benefits they can share with clients about the proper protection needed for high-value homes. Realtors and mortgage brokers are another strong referral source as they are often the first industry professionals to be alerted to a potential home purchase.
3) Innovative services. Younger generations expect convenience in all aspects of life and are looking for service providers that offer a seamless experience. These consumers expect digital tools with virtual claims adjusting and appraisals for quick service.
Independent agents should work with carriers that offer mobile apps for policy management, extended customer service hours, the ability to research online, and personalized communications for an exceptional customer experience. Independent agents that can rely on enhanced carrier and technical services will experience more success with this digitally focused generation.
4) Experienced counsel. Consumers purchasing high-value homes in the $750,000 to $3 million range need a unique suite of coverage but don't want to overpay. This demographic has lots of expenses and is often financially savvy, so independent agents that can discuss the unique needs of this demographic will build trusting, long-lasting relations that lead to business growth. Remind customers about flexible and broad coverage not just for the place they live, but for everything they care about inside it.
For agents looking to win the next generation of financially sound customers, it's more important than ever to align with carriers who understand this market and can offer coverage and services this clientele needs—and those needs are vast, with The Hanover's recent survey finding millennials need to protect boats (16%), collectibles (29%), and their identity (53%).
Look for carriers that rise to the higher level of service expectations and will partner with independent agents to solve the more complex insurance needs of high net-worth individuals. As these younger generations enter one of the more expensive times of their lives with new high-value homes, expanding families, and even paying off student loans, agents should offer a full risk assessment.
As these young Americans continue to purchase high-end homes, independent agents can capture this demographic and offer coverage for their home, auto and valuables by providing an enhanced customer experience. Look for opportunities to target younger customers as they are making big purchases and create valuable long-term customers.
Daniel Halsey is president of personal lines at The Hanover.