Staying Relevant in the Digital Age

Consumers are increasingly reliant on the Internet as a research channel to learn more about various auto insurance companies, compare plan options and request rate quotes online. According to comScore’s 2008 Online Auto Insurance Report, consumers requested more than 32 million auto insurance quotes and purchased more than two million policies online. This represents a 15% annual growth rate in online quotes and a 37% growth rate in online policy purchases. With the Internet growing as a source of information for auto insurance shoppers, nearly half (48%) of all consumers, and nearly two-thirds of those who bought their current insurance in the past two years received a rate quote online. Yet, despite the growth of online insurance, the role of the insurance agent remains extremely important to the industry.

People like having a real person to talk to about their insurance needs—not just an operator at a toll-free number, but a specific person who can advise them on their financial security. In a survey conducted by comScore earlier this year, 70% of those unlikely to purchase auto insurance online cited wanting to speak to or meet with a person as a reason for not purchasing online. And of those who used a local agent, 66% said one reason they did was because they like having a real person to visit with or call.

While independent agents remain solidly grounded within the insurance industry, there are some implications to the growing online landscape. In July2008, 189.1 million Americans used the Internet. Those consumers are well represented across all age groups, including 35-54 year olds who make up 36%of the U.S. Internet population and account for 43% of time spent online.

So what should independent agents be doing online? Advertising and communicating! As comScore research shows, consumers spend a large portion of their time online communicating—especially via e-mail. Agents should be taking advantage of this fact by using the Internet to communicate with their insureds. A monthly e-mail newsletter or a semi-annual personal note to customers will keep you top of mind, and enables you to educate them about additional products and services.

Consumers also do a lot of searching, especially when they are actively shopping. Searches actually account for the largest portion of online ad dollars, more than display ads. Therefore, it is important is to get listed on search engines, local search/Internet yellow pages sites and online review sites. Paid listings enable you to control your messaging as well as the destination when a user clicks on the link; that destination should be a professional-looking Web site that establishes the agent’s credentials as well as provides contact information. Online consumers frequently rely on reviews for purchase decisions, so encourage your best customers to review you on local search sites and consumer review sites.

The Internet is also great for agents when it comes to generating leads. About 20% of all online insurance quotes are at lead-generation Web sites. Consumers can go to these generator sites, put in their information and instead of getting a price, get a list of agents and companies that will provide them with a price. Agents in turn get the customer’s details and can call or e-mail them and provide a quote. Some of the bigger sites in this arena are www.insweb.com, www.netquote.com, www.insureme.com, and www.insuranceleadz.com.

With the advent of the Internet, the insurance business is changing. And while the net does not replace agents, it does change how they run their businesses. Instead of just putting an ad in the phone book, agents have to use the full spectrum of ways to reach customers online. Customers who choose to use an agent are looking for someone to provide expertise or entirely manage their insurance needs. Instead of spending time manually finding rates and doing paperwork, new technology lets agents focus on acquiring and servicing high-value customers. In the end, it’s a win-win situation for both agents and consumers.

Susan Engleson (sengleson@comscore.com) is senior manager at comScore Inc.