Gen Z Leads Demand for More Payment Options from Insurance Sector in the UK
- Written by: iPMI Global
- Over one in five (22%) consumers have had payment issues when buying insurance policies
- 35% of consumers look for preferred payment methods when buying insurance
- New Adyen and EY report spotlights the potential of fintech in the UK to positively impact the customer experience within the insurance sector
A new report published by Adyen, the global financial technology platform of choice for leading businesses, with research conducted by EY, has found that ease of payment is now a top three decision factor for Gen Z and millennials when they are looking to buy insurance.
35% of Gen Z potential insurance customers indicate that ease to buy insurance influences whether they will purchase insurance or not, outweighing concerns around fraud (14%) and security of information and data (28%). Value for money (49%) and policy coverage (49%) are the only two considerations that poll higher than ease of payment.
When exploring methods of payment, almost half of consumers polled (49%) said they wanted to purchase through mobile-first channels,and 35% look for the ability to pay using their preferred check out options – such as digital wallets.
While many insurance professionals support direct debit, nearly all (94%) of respondents said they want to use credit cards, debit cards or digital wallets to pay online. Over half (74%) of those surveyed aged 25 – 34 said that a pre-paid card would be appealing to avoid being out of pocket during a claim.
Top payment frustrations vented by consumers included being redirected to a second site for payment verification (37%), password and account detail issues (34%) and manually entering card information (27%).
Businesses must respond
The report found that more than two thirds of insurance professionals (73%) of insurance professionals believe the sector lacks leading payment capabilities, with 40% experiencing policy cancellations due to payment issues, and 31% reporting increased customer service calls because of payment failures.
While almost all (81%) of insurance professionals said that payments processing is important to the sector, the most impactful changes that could be made were:
- Improving error detection and resolution (41%)
- Increasing transparency and communication of payment statuses (32%)
- Automating customer payment processes and reconciliations (30%)
"Customers today demand more than just coverage. They want smooth online payment processes that allow them to choose their preferred payment channels and methods”, said Adrian Davis, Commercial Leader, Financial Services and Insurance at Adyen. “Yet, many insurers have a payment blind spot. By offering more seamless and flexible payment options, insurers could not only improve customer satisfaction but also drive significant business benefits—selling more policies, reducing operational costs, and cutting down on fraud.”
“It is essential that the insurance purchasing process is as easy and streamlined as possible to ensure no one is discouraged from protecting themselves against risk. Younger generations have grown up in a digital world, with increasingly simple and interconnected payment options available for all products and services, and the insurance sector must keep pace, and not risk losing new customers at the point of purchase.” said Chris Payne, EMEIA Financial Services Insurance Technology Leader, EY.
You can read the report in full here.
