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…