Archive for May, 2005


I noticed an article in Insurance Networking News last week that I thought had relevance to selling insurance online and what independent agents are looking for. The article is based on a recent survey conducted by Craig Weber @ Celent entitled “Independent Producers Survey: Technology, Services and Other Drivers of Carrier Choice.”

First a few data-points from the survey:
1. Only 14% of agents are “very satisfied” with the services and technology provided by “typical carriers.” This compares with a 43% rating for the “best carriers.”
2. The top four carrier attributes that drive agents’ carrier choices, in order of preference: claims handling, new business and U/W support, U/W speed, and commission rates.
3. For those new business applications captured electronically, a third use the carrier’s Web site, a third use an agency management system (AMS), and 12% use a carrier’s off-line proprietary software.

4. Relative to the use of various technologies by agents, under the heading of “Several times a day,” 93% of agents use high-speed Internet access, 70% use an AMS, 59% use proprietary carrier Web sites, 35% use an agency web site, and 19% use a PDA.

Very interesting! Here’s my take, in order of “interest.” Agents areare online and connected. They use the carrier sites more than they use their own sites, and they’re even starting to use what I call “field equipment.” As recently as a year ago, I remember hearing carriers saying that most of their agents don’t use the Web because very few of them even had e-mail addresses. Clearly that’s not the case today.

Even for the so-called “best carriers” (I wish “best” was defined, but it wasn’t), there is a lot of room for improvement. Again, I’ll use the restaurant metaphor. If you’re after repeat business, yes the food (insurance product) has to be great. But the overall experience has to be great, too, because there are so many options with more popping up all the time. So the setting right from the parking lot has to invite the agent – home page and sub-page designs are CRITICAL; the service has to be smooth, comfortable, and somewhat entertaining/compelling – navigation and work-flow has to make sense, have a nice feel, and have a gimic every now-and-then; and, of course, no “bugs,” right!?!?

Lastly, relative to items #2 & 3, notice that commission rates rank 4th right now. New business support and speed rank 2nd and 3rd. Hmmm, it looks like we have a VERY good potential ROI scenario for carriers to develop a Web-centric approach to servicing agents and facilitating new business and underwriting. A third of the agents are already using carrier sites.

Conclusion: Again, medium-sized and smaller carriers, do you see what the opportunity is here? Some of the largest carriers have done a good-to-great job with agent technology and are thus positioning themselves for long-term agent loyalty (assuming they stay on top of the sites and keep them current and fresh – like new paint and new furniture every now and then in the restaurant biz (easy to do if you set up the original carrier Web site correctly)). But the majority of carriers have left the door WIDE open for the medium-sized and small carriers to compete for Agent loyalty “online.” I’m 100% convinced that if these smaller carriers sieze the moment (and use a proven Web design and development company and don’t make a critical first-step blunder), they will position themselves as real players in their insurance niche as the industry moves more and more into the technology-assisted era.

Things carriers should be doing online today in support of traditional marketing efforts:

  • Agent enrollment/appointment
  • Agent portals for new business submission, app status, hierarchy reports, commissions, carrier/contest news, etc.
  • Product-specific lead engines to drive leads for agents
  • Product quotes
  • “Apply Now” e-applications with e-signature
  • Backend paperless integration (move from ‘imaging’ to live datafeeds)

Next stage:

  • Customer Self-service
  • Online Policy Maintenance
  • Web-enabled Policy-holder marketing & selling additional business

By the way, breaking news: I have been asked to facilitate a session at the November 2005 PIMA MarkeTTech SM Symposium. The session will focus on current best-practices in Web-based direct marketing of Health and Life insurance in the association context. More later…


The big event has finally arrived. I received the e-mail Wednesday from the Centers for Medicare & Medicaid Services. There will be a one-day Medicare Part D Marketing Material Guidelines Training, June 3, 2005 at the CMS Auditorium in Baltimore, Maryland.

The 2005 Medicare Prescription Drug Benefit (PDP) Marketing Material Guidelines Training is designed “so that those individuals who are directly involved in marketing material development and its dissemination will gain an understanding of the rules and processes that will govern the marketing activities of PDP organizations. Attendees of the conference will be the first to be formally trained on the new Medicare Part D Marketing Guidelines, including a walk-thru of the Health Plan Management System (HPMS) Marketing Module and the marketing materials review process. This will also be an opportunity to meet and better understand the CMS customer service process being implemented to assist plans in receiving approval of their marketing materials and support marketing activities.”

Netting it out, the HPMS sounds like a CMS “extranet” for Part D participants to get marketing materials approved, we’ll hear about the marketing materials development and review process, and a review of the required marketing materials themselves — both pre- and post-enrollment. Advertising and telemarketing will also be covered.

Interestingly enough, the Agenda does not reference Web-based materials. Again, as I mentioned in a previous post, I’ve heard from many sources that Web-based enrollments would be accepted. FYI, today I’m sending an e-mail back to CMS requesting the subject of Web enrollments be included as an agenda item. There are already a number of companies out there planning to use online Web enrollment as an easy way to reach potential customers, to increase efficiency, and maximize cost-control.

As with paper-based materials, any Medicare Part D Web site will also need to be approved by CMS. They’ve said that they will need at least 30 days for that process. Now if sites are to be live by Nov. 15, that really means the site needs to be CMS-certified by Nov. 1 in order to accommodate agent training and marketing. Development would thus need to be done by October 1. It’s May 20. We have four months and one week left – yikes!

Outside of IdeaStar, the industry buzz seems to indicate that most of other Part D companies have not begun developing Web-based enrollment processes (I’d be curious if any readers know otherwise). With 29 million enrollments within the first six months and only a $60 1st year commission available per enrollment (not including renewals), every cent saved through technology will count. A paper-based scenario will take a big chunk out of the $60. Paper enrollments will be a big challenge, especially if you factor in a typical 20% kick-out rate due to issues with completeness, legibility, accuracy, etc., etc…

So if you are considering offering Medicare Part D enrollments online, time is short….


Wow! There’s a new health and life insurance Web site that is groundbreaking from an aesthetic design standpoint. California Anthem Blue Cross’s targets young and healthy 19- to 29-year olds in a totally hip way — you know, those surfboard dudes and rollerbladers who think they are invincible.

It’s an innovative use of colors, language and images that make the site stand out – again targeting the younger crowd. I think the site does a good job of promoting why an insurance plan might in the long run save a person money if they are injured. So if you are a surfer dude, rollerblader or beach volleyball guy and you get crushed by a wave, crack your skull on the sidewalk, or blow out a knee spiking the ball, the plan will save you money.

It’s a great site! I love it! But I’d recommend a few things. First, the enrollment process needs a telephone verification system. Just in testing the site, I was issued a policy with only a valid e-mail address and a valid banking ABA number — everything else was fiction. It’s not a good idea to issue a policy unless you validate at least some of the data, including whether or not it’s a “real” person applying. This may be one of the reasons the site is allegedly enrolling so many people. Maybe not all the enrollees are legit. And I’d hate to see Anthem be impacted by the dreaded “adverse selection.”

Second, the unfortunate other thing is when you hit the “View network” or the education and resources pages, you link out to the main Blue Cross site with a whole different look and feel. That’s a little startling and distracting. Evidently the Blue Cross site doesn’t use a style guide, so it’s not possible for the Blue Cross site to change its look on the fly to match the Tonik brand. And, the VIP Lounge takes the viewer to the main Blue Cross site where you can log in as a member. I found that to be a little misleading. People might think it’s a little gimmicky or patronizing, and that’s not a good thing in the long run.

Third, in the very first step of the enrollment process, you start with a Web page that looks like a pop-up window labeled “Buzz, Kill.” It’s kind of “Whoa.” Then it’s a long scrolling form with very important Benefit Details. The information is presented as if it is just a general legal disclaimer with an “I accept button” at the bottom. So the information is a bit out of place and the box itself is too small. The font is too small, and too much language is presented all at once.

These are some issues they’ll probably want to deal with in the second generation of the site. You don’t want to lose peoples’ trust in your health care concern and authenticity.

But it’s a great site. I applaud Anthem’s courage to break new ground and develop a site which fits the market they are targeting. It will be interesting to see how the Tonik product performs financially over the next couple years.


A recent article in Insurance & Technology deals with Allmerica Financial and its desire to grow its property and casualty business. The company was looking to give agents the ability to write policies online without Allmerica staff involvement.

“Like everyone else, they looked for a system that is low-cost while providing excellent service for agents. The system they developed through a technology partner was completed in four months and ended up costing around $1 million. The Web-based administrative functions were not included in the cost. By the way, one of the other objectives focuses on competitive advantage and recruiting agents to sell Allmerica products. The project has been successful, making agents more productive and luring new agents into the Allmerica fold.”

I find this article interesting for a couple of reasons. First, it reinforces the whole concept that agents want online, easy-to-use, flexible and feature-rich tools from their carrier to help them write more business with less hassle.

Second, I can’t help but compare this case study to a similar project that I am involved in that’s just about ready to launch. Our solution, which sounds very similar, is also taking four months. But it also includes the agency management login and reporting, and will only cost our client around $100,000. Hmmmm.

Carriers large and small need to provide their agents with Web tools wherever possible. Outsourcing the design, development, and hosting is the best, fastest and most cost-effective way to go. (However some suppliers are more cost-effective than others.)

Archives to 2005