Wealth Management – One in three seniors prefer insurance companies to banks to buy investment products

Wealth Management – One in three seniors prefer insurance companies to banks to buy investment products moreover, a certain distrust of the banks prevails. In fact, to purchase investment products, one out of three prefers to turn to insurance companies, which appear to be a more reliable distribution channel, precisely, 33% of the elderly do not trust banks against only 14% of companies. Furthermore, the latter are the preferred channel for the purchase of personal, family and property protection products, in fact, 72% of them buy insurance from companies against only 17% from banks. Banks therefore have the opportunity to build an insurance offer specifically dedicated to older age groups of the population, not only to increase their market share in the insurance market, but also to strengthen the relationship with these customers and help them through investments to meet the expenses of old age: the over 65s have an average wealth of 230,000 euros, but also have average annual expenses of 32,000 and 6% of their assets tend to decrease every year.

This is what emerges from a research by Excellence Consulting which interviewed a national sample of 500 elderly people.
The Excellence study – which found ample space in sector publications, including Milano Finanza and Il Sole 24 Ore – refers to the parameters used by Istat, indicating the over 65s in the segment of the population which today represents around 23% of the total, the third largest band in the world. Between movable and real estate investments, these customers have an average of 230 thousand euros and their impact on the Italian economy is worth 620 billion. In detail, if we analyze their propensity towards the banking-insurance world, it can be seen that, if on the one hand there are just eight percentage points of difference between purchases in the insurance sector (36%) and in the banking sector (28%).

The discrepancy between those who say they do not trust insurance companies (14%) and those who trust banks (33%) rises to 19. According to the interpretation of Excellence, there may be two possible reasons for this: on the one hand, the companies respond better to the needs of the over 65s, starting from assistance, to protect themselves, their families and their assets, on the other they represent a preferred means of purchasing protection products. In fact, if on the one hand the breakdown of premiums by distribution channel is taken into consideration, property damage policies are purchased more from insurance companies (77%) and much less from banks (12%), a trend that is repeated regarding accidents and illnesses (70% insurance companies and 15% banks) and other non-life classes (75% companies and 7% banks). On the other hand, examining the purchasing behavior of the over 65s, 72% of them purchase insurance products from companies and only 17% from banks.

“The silver economy – declares Gianluca Zanini, partner of Excellence Consulting – will assume an increasingly growing role due to some now clearly outlined socio-demographic trends. Italian seniors are on average wealthy and not very indebted. Their average wealth amounts to 230,000 and their debt is less than 10%. If not properly approached, the rate of decumulation will accelerate thanks to the high level of inflation and the negative trend in financial literacy. Old people don’t trust banks to buy financial products. It is a question of catching up, not only in terms of communication and making financial products more attractive and interesting with a view to protecting the last part of the life, but through a review of the banking organization by assessing this target as one of the most profitable.”
“Our analysis – says Maurizio Primanni, CEO of Excellence Consulting – reaffirms how the over 65s are a fundamental target for the financial and insurance world, both because they already represent a large portion of the population of our country today, and because it will tend to grow further into the future. There is a need for banks to build an offer specifically dedicated to these customers, on the basis of which there must be valid personal, family and asset protection products. According to Bankitalia, the over 65s spend an average of 32,000 euros each year, well beyond their disposable income and consequently 6% of their assets tend to decrease on an annual basis. There is also the possibility for banks to guide these customers in making investments that ensure over time the replenishment of assets which tend to decrease due to excess spending compared to the income received.”