With all the talk about millennials changing the workplace and boomers leaving it, members of Generation X (born 1964-1979) are once again finding themselves stuck in between two big stories. Yet when it comes to the insurance industry, Generation X is the story.

Who is Generation X?

The demographics of Generation X are well known: it is the smallest generation, with more than 10 million fewer members than either the generation they follow (boomers) or precede millennials); its members were latch-key children who had to raise themselves and their younger siblings; and it’s the first generation to have watched its parents’ divorce in record numbers.

Now moving into middle age, Generation X has a new set of challenges, many of which center on financial security. The first generation to have less wealth than their parents, Generation X is now often supporting those same parents as well as their own children, with nearly 20 percent reporting providing regular care for older parents or other relatives. According to the Pew Research Center, for members of this sandwich generation (those supporting both children and parents), the strain of supporting multiple family members can have an impact on financial well-being. This strain is visible: Generation X respondents to MetLife’s 13^th Annual U.S. Employee Benefit Trends Study (EBTS) showed greater job security and financial concerns than any other generation currently in the workforce.

And it’s no wonder. Unlike generations that came before them, Generation X has little retirement security, in the traditional sense. They are the first generation to be affected en masse by the shift from traditional pensions to 401(k) defined contribution plans, and the one pension they may have relied upon — their government Social Security check — is not guaranteed either. The oldest Gen Xer turns 65 in 2030, just a few short years before the Social Security trust is projected to run out of funds.

Is it all doom and gloom?

The Generation X story is not necessarily a pessimistic one, however. Members of this generation are taking action — especially when it comes to protecting themselves and their families. According to sales data from Liazon, operator of private exchanges for businesses nationwide, members of Generation X who are given the opportunity to choose their own benefits from an array of options are buying more insurance products than any other generation, an average of 5.3 non-medical products per person.

Employees who purchase their benefits through exchanges such as Liazon’s have a variety of benefit types to choose from, including life, disability, supplemental health, and even pet insurance, which they can buy using a lump sum of money provided by their employer. Based on Liazon’s data, they tend to buy more non-medical products than the overall working population as they reallocate the benefits dollars that were formerly earmarked to medical to other insurance options.

Liazon data show Generation X buying significantly more critical illness insurance, life insurance and disability insurance than other generations in the marketplace, showing at least some understanding of the impact an illness, disability or premature death could have on family finances. In fact, the EBTS found that 53 percent of Gen Xers report being very concerned about financial security in the event of premature death, 60 percent express concern about having enough money to pay their bills if someone in their household loses their job or is no longer able to work and only 31 percent say they have a savings cushion of at least three months of salary, making unexpected health care costs a real burden.

Although Gen X is buying more than other generations, this generation, with its financial responsibilities and lack of savings, is not yet buying enough. Data from LIMRA shows that the majority of Gen Xers believe they need more life insurance than they have, though they are not moving swiftly to augment their policies.

How can employers help?

The confluence of circumstances — losing savings in not one, but two recessions; supporting children and older parents; significant amounts of debt and an uncertain retirement — make Generation X the audience most in need of a full suite of benefits. From financial protection to identity theft solutions to overall peace of mind, insurance products can help Gen X ease into their later years with comfort and confidence. But how should employers reach out to this notoriously skeptical group?

First, speak directly to them. Address their worries and position solutions that meet their specific needs, not those of their older or younger colleagues. MetLife’s EBTS showed a clear concern for making financial decisions for the family, so employers should keep that in mind as they make offerings available to this audience.
Second, although not digital natives, this is a digitally-savvy audience that is not afraid of technology. New distribution channels, such as private exchanges, take advantage of technology and help employers to offer more flexible benefits programs with more robust, personalized benefit education for employees. The need for better benefits education and communication is significant for Generation X. MetLife’s EBTS shows that, compared to millennials and boomers, fewer members of Generation X feel in control of their finances.
Lastly, offering benefits packages that can be customized to meet the unique needs of each individual can impact employee loyalty — and ensure they are getting the insurance they need. Deloitte’s 2012 “Voice of the Life Insurance Consumer” survey showed that significant life events such as getting married, having children or changing jobs are potential triggers for life insurance purchase decisions. And Gen Xers find themselves either facing or having faced many of these situations in recent years.

Targeting Generation X with appropriate educational tools and information about benefits is a win/win. Employees get the protection they need and greater peace of mind regarding their family’s financial security and employers have happier, more productive employees. Even better for employers? According to EBTS, employees with access to more lines of coverage are more satisfied with their jobs and less likely to leave.

Instant Insights /

Why Gen X is the bullseye generation for non-medical benefits

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