Making the complicated seem simple is one of the attributes of a good life insurance agent, but finding a way to do that electronically is a little more difficult. Consequently, life insurance sales over the Web are more about information than about closing the deal.
Conning Insurance Research & Publications (www.conning.com) recently conducted a Life Insurer Web Site Assessment, and author Elvin Turner, a Conning vice president, said there are a number of good uses for the Internet for life insurersselling is only one of them. The Internet should be integrated into your overall strategy, he said.
The report states that five distinct groups have defined the life insurance industrys Internet presence: Internet aggregators, cyber agencies, traditional insurers, cyber facilitators, and non-insurance financial service companies.
Turner points out there are differences between life and P&C insurance on the Internet. While there are several Internet-only P&C insurers, the number on the life side is almost nil. He added that life insurance aggregators have not shifted to the cyber-agency format that is often seen on the property and casualty side; life agents continue to operate on a lead generation model.
The Conning report also acknowledges that noninsurance financial services companies are playing a more significant role in life insurance than they are in P&C. With their ability to connect electronically with consumers, such companies may have the greatest impact on the evolution of the life insurance industrys use of their Web sites.
Nationwide Financial Services, one of the life insurers assessed by Conning, believes the Internet has a long way to go before it can replace an agent force when it comes to life insurance sales. The reason? The public doesnt want it.
In todays world, the Internet is an important supplement to face-to-face advice, but not a replacement, said Michael Butler, senior vice president of NFS Distributors. Investment professionals continue to be trusted resources for affluent individuals looking for comprehensive financial plans, estate planning guidance, and help planning for income management in retirement.
Nationwide conducted its own survey of 500 professionals under the age of 60 with annual incomes over $150,000 per year. It found that the Internet was a valuable tool for research (74 percent said so) and tracking investment portfolios (55 percent agreed), but only six percent reported actually going online to purchase an insurance product.
Turner doesnt take sides in the argument over whether life insurance products are too complicated to sell on the Web, but he does point out, Whether they need them or not, people want agents. They are comfortable with them and they are a permanent part of the life insurance landscape.
The Internets greatest benefit is as a validation tool to integrate with the sales force. People go to Web sites before meeting with agents so they have some idea of what to expect, but Turner points out that a Web site to adequately explain all the terms used by agents would be a help. There is no place consumers can go for all the terms they are hearing from agents, he said. That kind of site would be valuable. ROBERT REGIS HYLE
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