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Insurance agents deliver strong person-to-person customer relationships while delivering distinctive customer experiences. Carriers can leverage this if they arm their agents to compete in a digital world.
Consumer trends point the agency channel toward a digital future. Competitively speaking, social and digital media matters like never before. Insurers and agents unwilling, or unable, to integrate and engage it effectively will lose relevance and ultimately miss out on growth opportunities.
Two major trends suggest that business as usual is no longer viable: the growing number of online shoppers, and the increasingly intense competition from direct writers.
Of the consumers looking to buy insurance, many are incorporating digital channels as part of their buying process. In fact, J.D. Power & Associates research shows that 54 percent of auto insurance shoppers report getting their quote online.
Online shoppers expect to learn about carriers, compare products, obtain price quotes and purchase a policy quickly and easily. Some rely on social media to get information and advice about products, brands and purchasing decisions. Twenty-one percent of consumers use, or are considering using, social media to perform research on insurance products; 36 percent of consumers under the age of 34 would consider using social media to perform such research.
Some shoppers prefer to chat online, text or e-mail rather than to call or meet in person. Many shoppers who conduct research online will ultimately buy insurance from a human—either a local agent or a contact center associate. Similar to consumer behavior already widely observed in the retail industry, rather than replacing one channel with another, many insurance consumers are diversifying and using more channels than ever to meet their needs.
These key market trends are causing a shift in the role of agents and brokers, still the primary channel for insurance distribution. Agents are being called upon to increase sales rather than simply retaining the existing customer base built earlier in their careers.
Even those agents who are motivated to make the shift to a sales focus lack a clear Web or social media strategy, a branded, feature-rich digital presence, relevant digital content and robust tools that better connect them with customers and the insurer. Agents generally do not have available or ample funds, skills and time to construct and run their own high-impact, competitive sites, and do not have adequate marketing budgets to drive traffic to those sites.
With scale and efficiency on their side, carriers can drive transformation of the agency structure into a digitally-powered, more competitive engine for growth. Carriers should take four key actions to make it happen:
Download Full Report [PDF, 601KB]
March 20, 2012
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