Only 65% of millennial homeowners insurance customers bundle multiple policies with their insurer—a 5% drop from last year and 13% less than all other generations, according to the J.D. Power 2015 U.S. Household Insurance Study.

What’s responsible for the decline?

“Gen Y customers are saying they’re unbundling to receive better coverage, different coverage or more competitive pricing and this is much more often when compared to boomers,” says Valerie Monet, director of the insurance practice at J.D. Power.

Evaluating both homeowners and renters insurance consumers, the study found that 48% of Gen Y consumers report unbundling for price and 38% for better coverage, compared to 41% and 19%, respectively, among boomers who unbundle. Although the study did not determine whether the younger generation is finding superior rates and products, insurers should pay close attention and respond to their needs.

“Price is really important to Gen Y,” Monet says. “Increasing awareness of discounts and ensuring the customer is understanding their policy terms and coverages are also large gaps between the Gen Y and the boomers. There’s some opportunity to either better communicate or communicate differently to the Gen Y customers to get them on the same level.”

The drop in bundling may correlate with the generation’s lower satisfaction with their homeowners insurer when it comes to customer experience. Gen Y customers reported a 753 satisfaction rating with their homeowners insurer on a 1,000 point scale based on five factors: interaction, policy offerings, price, billing and payment and claims—compared to boomers’ rating of 787. And for those who do bundle, Gen Y’s 779 satisfaction rating pales in comparison to the older generation’s 811.

Monet says the satisfaction gap results from “the underperformance of the traditional agent call center and service interaction channels,” adding that Gen Y consumers are reporting longer perceived wait times and the need to repeat information more often.

And when it comes to billing, “Gen Y customers are interacting and paying their bills through their preferred methods less often than boomers, which is highlighting the need for insurers to better meet those customer needs by offering multiple communication and billing methods including apps and more self-service options,” Monet says. “It’s not that these options aren’t being offered, it’s just that they aren’t being communicated. People aren’t aware that they’re out there.”

But despite the decline in satisfaction, Monet says agents are doing something right when it comes to interaction with homeowners. “The agent experience is really overshadowing [the negatives] and it’s a great driver of the improvement that we see,” Monet says. “The largest annual increase we have is ease of contacting your local agent, followed by your agent’s concern for your needs, timeliness in resolving your problem, question and request and the courtesy and the knowledge of the agent.”

Given that 98% of consumers are bundling auto and home, with individual life (48%) and umbrella/personal liability (25%) insurance packages close behind, where does the opportunity lie for agents?

“We heard Gen Y customers say that price, including price transparency and better rates, is the most common area insurers need to improve on,” Monet says. “To that end, an insurer that has either an independent or exclusive agency force, they’re really the face of the insurer that can help drive that home—the ability to explain the price, what it’s covering, give a solid explanation, in a way that will explain what the product is going to cover for them.”

Morgan Smith served as IA assistant editor.