New research from Vertafore reveals millennial love-hate relationship with insurance, valuing coverage but prioritizing Netflix
Findings Uncover that Repeal of the Affordable Care Act (ACA) Would Put Generation at Serious Risk of Losing Access to Healthcare Insurance, with More than Half of Young Millennials Currently Covered Under Parent’s Plan
BOTHELL, Wash. – February 8, 2017 – Vertafore, the leader in modern insurance technology, today released the results of a new study evaluating insurance sentiment and coverage rates of U.S. millennials as it relates to their personal finance habits. The survey of nearly 450 consumers ages 18 to 35 revealed that more than three-quarters (77%) of respondents understand not having insurance is risky, yet they remain the most underinsured generation – covered on average 14 percent less than older age groups across health, renters, home, life, and disability insurance. Ironically, while a vast majority of millennials (80%) have health insurance, prioritizing healthcare over all other forms of insurance, 88 percent admit they would rather go without health insurance for a year than give up their cell phone. With more than half (52%) of younger millennials (18-25) now under their parent’s healthcare plan and at risk of losing coverage if the ACA is repealed, this could mean giving up favored millennial luxuries such as Netflix, cell phones, or dining out.
Key findings of Vertafore’s 2017 millennial personal finance and insurance survey include:
Healthcare is Top Insurance Priority but ACA Repeal Could Impact Coverage Rates
Covered at a rate of 80 percent, millennial respondents prioritize healthcare over all other forms of insurance. However, that rate of coverage could significantly change given that more than one-third (35%) of all millennials aged 18-35 are either covered under their parents’ plan or purchase insurance through an exchange, both key mandates of the ACA. If the ACA were to be repealed, this group would be at risk of losing health insurance altogether. Additional key findings include:
- Young millennials (18-25) are most vulnerable to losing access to health insurance if the ACA were to be repealed, with more than half (52%) currently covered under their parent’s plan.
- Following the recent presidential election, one-fifth (20%) of millennials cited feeling more at risk of losing their health insurance.
Insurance Gap is Putting Millennials at Financial Risk
Although a majority of millennials believe insurance is complicated and expensive, more than three-quarters (77%) do understand that not having insurance is risky. When evaluating rates of insurance coverage, however, a gap emerges between millennial personal finance habits and the insurance they purchase, such as:
- The most significant disconnect in insurance coverage falls to millennial renters, with more than half (58%) failing to purchase renters insurance. According to Allstate, the average renter in a two-bedroom apartment has $30,000 worth of personal belongings – property that would not be replaced in the event of a fire, flood, or break in.
- When it comes to auto, 17 percent of millennial drivers were uninsured – 5 percent higher than the national average of 12 percent (according to the Insurance Research Council). This puts millennials at greater risk, liable for thousands of dollars if held responsible for an accident, which at last count averaged anywhere from $9,300 per incident for property damage to $80,700 for a disabling injury (National Safety Council).
- As it relates to disability insurance, older millennials (26-35) were nearly two and a half times more likely to purchase coverage than their younger (18-25) counterparts.
When Push Comes to Shove, Millennials Choose Luxuries over Insurance
Despite the common assumption that millennials are irresponsible with their money, when comparing insurance purchases and personal finance habits, the survey reveals they buck the misconception and incorporate insurance into their budgets as financially able. That is, unless that means giving up television streaming services such as Netflix, cell phones, or dining out. Additional personal finance insights include:
- Although renters insurance costs an average of just $144 annually, only 40 percent have purchased this type of insurance – indicating a stronger preference to spend $100 a year on television streaming services like Netflix as well as craft beer and spirits over coverage.
- Millennials are not all irresponsible – nearly 60 percent reported being unwilling to skip, delay, or temporarily stop paying for healthcare insurance if given the choice to save money.
- A majority (63%) of millennials spend less than $300 a month on all forms of insurance, and more than half indicated they would invest in more insurance if they could afford it. Ironically, over 60 percent admit to spending more than $75 a month on eating out.
“Despite common misconceptions that millennials are unaware and uneducated about insurance, our research clearly shows they value insurance but financial barriers and personal spending habits inhibit securing proper coverage,” said Bruce Winterburn, VP of Industry Relations at Vertafore. “As we begin the new year, now is a great time for millennials to align what they know to be true with the actions they take on insurance coverage. Their future finances depend on it.”
Vertafore’s study polled 1,294 U.S. residents, including 444 millennials ages 18 to 35. Approximately 48 percent were males and 52 percent were females. SurveyMonkey conducted the survey in November 2016 and the full survey results are available upon request.
Vertafore offers the broadest and most adaptable technology solutions to better prepare the insurance industry for digital disruption. The Vertafore product line is built on a platform, empowering customers and other solution providers to adapt and thrive as the market changes. Vertafore’s platform features fast innovation, partnerships with the best technology companies, and customizable solutions to help companies remain independent during a time of industry disruption. As the leader in modern insurance technology with the largest customer base in the industry, Vertafore connects every point of the distribution channel, from agencies and carriers to MGAs, MGUs, and state governments. For more information about Vertafore, visit www.vertafore.com, read the company’s blog, and follow the company on Twitter, LinkedIn, and Facebook.
© 2017 Vertafore, Inc. All rights reserved. Vertafore and the Vertafore logo are trademarks of Vertafore and its subsidiaries.
Media Contact Michelle Isacson
Barokas PR for Vertafore