Does it seem strange to discuss life insurance when engaging with younger clients, especially those born in the early 2000s? After all, this generation is tech-savvy, seemingly more informed on financial products and skeptical of traditional financial products such as insurance. Arun Kumar Dasari, a five -year MDRT member from Chennai, India, believes financial advisors must use new strategies and techniques to discuss life insurance products effectively with younger clients. 

Understand needs and goals

Firstly, it is essential to understand client needs and critical financial goals. Financial advisors should tweak their approach for younger clients in India and consider resolving financial burdens such as student loans and early debt. 

Dasari says, "We should ask open-ended questions about their client's goals, such as buying a house, starting a family, or traveling the world. Understanding their goals will enable advisors to position life insurance as a tool to help them achieve those goals and a roadmap to financial security and early planning."

He emphasizes the importance of understanding risk tolerance for a good investment return. Dasari adds that a robust financial plan hinges on the ability to gauge risks and a profound understanding of cash flow dynamics to withstand fluctuations. Getting a good sense of risk tolerance is critical for advisors serving younger clients. He shares, “In a recent consultation with a Gen Z client, I delved beyond numbers to understand their risk tolerance. Through open dialogue, I learned about their ambitious goals tempered by cautiousness from family experiences. By using hypothetical scenarios and interactive tools, I helped them visualize risk-return dynamics, enabling them to make informed decisions aligned with their aspirations.”

According to Dasari, individual needs and financial goals keep changing, and individuals in the 20-to-30 age group will be looking at earning more quickly. “As one crosses 40 and beyond, the focus shifts to investing in long-term retirement plans. In life insurance, where market-oriented and conservative plans exist, younger individuals are usually inclined toward aggressive policies that involve higher risks but promise greater returns. The allure of higher returns makes aggressive plans attractive to youngsters. Advisors must be able to tweak their strategy accordingly," he says.

Going digital first

Gen Z has grown up with accessible internet and digital technology access in India. They value convenience and accessibility, so financial advisors should leverage technology to engage effectively. 

Dasari says, "Traditional banking has moved to digital platforms to effectively communicate with younger clients who prefer online interactions over visiting physical branches. Through user-friendly websites and apps, digitalization plays a pivotal role in providing a seamless customer experience. " 

According to Dasari, creating simple and efficient digital platforms drives traffic from youngsters. He adds, "Social media engagement is also crucial, as a powerful tool to connect with young clients through regular updates on activities, product launches, and events."

Dasari is also bullish about the transformation artificial intelligence (AI) tech can bring to the broader sector. "Advisors must offer interactive features that allow clients to feed in financial information and get personalized recommendations. They can also utilize technology, including AI-driven underwriting, significantly reducing costs. AI can automate the approval or rejection of applications based on risk scores, making it quicker. Moreover, AI-powered chatbots can provide real-time assistance, enhancing the application experience." These tech tools, Dasari argues, will help youngsters access financial products such as insurance more efficiently and incorporating them should be crucial for advisors.

The importance of storytelling 

Financial advisors must be conscious of the power of storytelling and share real-life stories of how life insurance has impacted families or individuals, Dasari says. 

This can be done by highlighting examples where life insurance provided financial security, paid off debts, covered medical expenses, or helped beneficiaries through challenging times. He explains, “In a meeting with a Gen Z client, I shared a personal story of a financial mistake I made in my youth to illustrate the importance of planning. By relating my experience, I established trust and showed empathy for their situation. The story resonated with the client, prompting them to engage more actively in the discussion. Through storytelling, I emphasized the benefits of proactive planning, motivating the client to act towards their financial goals. This approach fostered a deeper connection and empowered the client to make informed decisions for their future.”

"When younger clients see the real-world benefits of life insurance, they are more likely to appreciate its importance in their lives," says Dasari. 

Tailormade financial planning

Financial advisors should approach life insurance in the broader context of financial planning. The key points should be how life insurance fits into a comprehensive financial strategy. Advisors should speak on budgeting, savings, investments, retirement planning, and life insurance. Dasari says, "A strong product knowledge is essential to engage and maintain clients' attention. Communication should be in simple language to avoid confusion, and effective presentation is important."

Dasari adds, "A combination of product knowledge, clear communication, and personal connections contributes to successful networking and building a positive relationship with clients across age groups.

Winning the social media game 

Finally, social media is a powerful tool for reaching younger clients. Dasari reckons advisors can utilize platforms like Instagram, short video platforms, and YouTube to share informative content about life insurance. They can collaborate with influencers specializing in personal finance or insurance to reach a wider audience. Advisors can also create engaging, short videos or posts that demystify life insurance and its benefits. They can use statistics and relatable scenarios to capture the attention of younger clients who spend significant time on social media. 

Dasari shares how he utilizes platforms such as Instagram and TikTok to share bite-sized financial tips and insights in a relatable and engaging manner. “For instance, I recently posted a short video series on budgeting hacks tailored specifically for Gen Z audiences. By using creative content and staying active on these platforms, I've been able to effectively reach and engage with younger clients, fostering meaningful conversations about financial literacy and planning in a digital age.”

 As Gen Z clients increasingly become a significant demographic in the financial landscape in India, financial advisors must adapt their approaches to meet the expectations of this tech-savvy and socially conscious generation.

Contact: MDRTeditorial@teamlewis.com

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Engaging Gen Z: How to discuss life insurance with younger clients