Banking, payments, retail, travel, and transportation have all trained young consumers to enrol, transact, and resolve issues instantly from their phones. Insurance, however, lags behind. It still expects customers to tolerate slow enrolment flows and multi-step claims processes.

Lack of value

The difficulty of navigating digital claims has become so pronounced that over one in four Gen Z policyholders are avoiding insurance claims altogether because they find digital platforms too difficult to use, meaning these customers would rather absorb a financial loss than interact with their insurer. This represents a fundamental breakdown in the value insurance is meant to provide. 

To meet the expectations of the next generation, insurers must modernise their architecture and their customer-facing experiences, delivering protection that feels intuitive and, when done right, nearly invisible.

Why younger customers abandon insurance journeys

For much of the last generation, insurance was something consumers encountered sporadically and often passively. Younger customers now are more aware of risk and liability and expect protection to be delivered through automation, not dense instructions or paper-based workflows. In an economy shaped by real-time banking and mobile payments, waiting days, even hours, for basic insurance feels frustrating. 

That expectation mismatch is obvious at the first point of contact. Younger consumers often begin their research on platforms like Google and TikTok, where information is found quickly and intuitively. In fact, 84% of Gen Z use social media to get information and recommendations on financial products like insurance. Yet when many arrive on insurance websites, they’re met with unfamiliar terminology and complex decision trees. Rather than building confidence, this information overload creates hesitation.

The breakdown continues across the insurance journey: 

• Onboarding remains confusing and information-heavy, which feels outdated for people who desire digital and on-demand services
• Verification usually requires manual document reviews and little-to-no instant validation, interrupting momentum
• Claim workflows force customers to switch between email, phone, and portals with no clear visibility into claim status  
• Authentication relies on complex usernames and passwords with limited support for single sign-on (SSO) methods.

It’s not simply impatience. Young consumers can interpret confusing processes as signs of risk. When customers hesitate to complete enrolment or avoid filing claims altogether, it signals a breakdown in trust at the time when insurance is meant to provide reassurance.

The difficulty of navigating digital claims has become so pronounced that over one in four Gen Z policyholders are avoiding insurance claims altogether

Building the architecture for instant coverage and claims

The limitations younger customers encounter are not merely design flaws but structural issues. Many insurance platforms were built for batch processing and scheduled reviews, not real-time decision-making. Hard-coded processes and siloed data make instant coverage or claims resolutions difficult to achieve, regardless of how polished the interface is. 

Delivering instant coverage requires insurers to adopt a modern, integrated platform strategy that treats enrolment, underwriting, claims, and payment as continuously connected processes rather than isolated steps. 
At the foundation of this shift are application programming interface (API)-driven platforms that allow systems to exchange data in real time. These also make embedded insurance models viable at scale, enabling coverage, compliance, and payments to be integrated directly into the digital environments where customers already transact. When each system operates in sync, verification can occur instantly and can be adjudicated, meaning manual queues are reserved for exceptions, not routine cases.

Once insurers modernise their core systems, they can redesign customer journeys around how the next generation wants to interact with digital services

Cloud-native infrastructure plays a critical role in making this possible. This supports low-latency processing and scales as demand fluctuates. Cloud environments also simplify integration with mobile apps and third-party services. This flexibility is essential as interactions move beyond traditional portals and call centres. The same platforms enable modern authentication methods, including biometric login and SSO, removing unnecessary barriers at the start of the customer journey. 

Equally important is the use of artificial intelligence (AI)-powered risk assessment and fraud detection, which is accelerated by automated underwriting and claim evaluations. In mature implementations, AI can support the entire claims process, from first notice of loss to payment, reducing cycle times from days to seconds while maintaining appropriate oversight.  

Achieving this modernisation requires insurers to confront technical debt. Shifting resources away from maintaining legacy systems and toward modernisation frees up capital and talent to build the next generation of insurance products. Modernisation is not an IT project but a precondition for growth and the foundation of a real-time insurance experience.

Meeting customers where they are

Once insurers modernise their core systems, they can redesign customer journeys around how the next generation wants to interact with digital services, ideally in intuitive, predictable, and low-effort ways. 

A critical starting point is making sure that verification and enrolment feel simple and not interrogative. Quote-first flows allow customers to see pricing and coverage before providing deeper details. Presenting those options in clear tiers – in a good, better, best pricing scale – helps customers understand trade-offs quickly, reducing abandonment by delivering clarity early in the process. Instead of forcing users through document-heavy steps, mobile capture and optical character recognition (OCR) transform verification into a simple action. 

For example, when renting a property, a customer can photograph a lease, allowing move-in dates to be extracted automatically. A few reassuring lines of micro-copy, like ‘This will only take two minutes’, help to reduce anxiety and keep users moving forward. 

The same principles apply to claims and ongoing communication. Rather than fragmented workflows, modern experiences emphasise simple resolutions within a single channel. Step-by-step, guided interfaces allow customers to submit information in manageable stages, while clear progress indicators reduce uncertainty and make the claims process feel more predictable. Digital evidence submission eliminates paperwork and accelerates review. When paired with integrated digital payments, straightforward claims can move from submission to settlement without leaving the mobile app or website portal. 

These improvements also extend to the design of insurance products themselves. Gen Z values flexibility, including pay-as-you-go policies and usage-based insurance. For insurers, these models improve relevance and create opportunities for cross-selling and lifetime relationships. 

Younger customers judge insurance by the standards set elsewhere in their digital lives. Meeting that expectation depends on platforms that can support real-time decisions, automated checks, and mobile-first interactions. Insurers must operate in real time or risk falling out of step with the customers they are trying to retain.