Research from the leading pensions and financial services consultancy shows that with-profits products are the most popular variation of a savings or long-term insurance product amongst almost half (43%) of consumers surveyed. However, splitting the results by age showed that Gen Z (18-26 year olds) appear to be more driven by professional advice (39%) compared to Gen X (43-58) year olds, the majority of whom made their choice independently (40%). Only 14% of Gen Z respondents chose their with-profits product by themselves.
Over a quarter of Gen Z respondents chose having investment decisions managed in line with clear objectives, but not requiring ongoing input as one of the three most important product features they value. Ready-made solutions, with clearly defined investment goals is an area where the research highlights that further innovation should be expected – building on initiatives like Investment Pathways.
The research also highlights that each generation has slightly different journeys or reasons for choosing a with-profits product. It is therefore well worth insurance providers investing in understanding how these motivations differ so they can better target, build and maintain their pipeline of with-profits consumers.
Commenting on why it is important for insurance providers to look closely at each generations’ motivations, Rebecca Macdonald, Head of Products, Hymans Robertson, says: “It was really interesting to see the differences between the generations in our research results. The fact that they are so significant, in some instances, when compared to the averaged response highlights the valuable insights available here. For insurance providers looking to better target their offerings and develop new products, discovering what drives certain groups could be a reliable way to secure a pipeline of consumers over the longer-term.
“The variance between the number of Gen Z and Gen X respondents that chose their with-profits product because they personally thought it was the best option for them is proof that there are likely lots of different drivers at work. Gen Z it appears, may be less confident making decisions about these types of products alone – preferring to lean on an adviser, or even friends and family (34%). Whereas Gen X are more confident to go it alone and make up their own mind. Therefore, working on averages is likely not as useful as drilling further down into the detail.”
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