By the same token, agents have not taken advantage of all the Internet has to offer, one observer contends, with most agencies producing static Web pages that do little to drive online sales or interest by the consumer.

The overall promise of “skyrocketing sales” of insurance over the Internet is a bigger bust than many of the dot.com companies on Wall Street, according to Patricia Borowski, senior vice president of the National Association of Professional Insurance Agents in Alexandria, Va.

Those agents who have had success on the Web, she pointed out, are those who have managed to put an insurance product online that is simple to purchase and unique in nature. The problem, Ms. Borowski continued, is when the products require extensive questioning and underwriting.

“The Web has not replaced the traditional role of the independent agent,” Ms. Borowski observed.

There has been much more technological success on the servicing and communication end, where companies, consumers and agents have managed to get information to one another via the Web faster than in the past, she noted.

One Internet sales success story is West Insurance Agency in San Francisco. By developing an aggressive, interactive Web page, the agency drove online sales to between 100 and 150 policies each month of small-commercial, personal lines and surety bonds, according to Gary Savelli, president of Internet operations.

The agencys operations were so successful that he wrote a book based on his experience, “Selling Insurance on the Internet” (available at www.insurance-web-sales.com).

Many agents, Mr. Savelli pointed out, produce Web pages that are nothing more than a calling card or a brochure for their agency. They might have additional site information and a way to get a quote for a particular line if the consumer should come across the page.

Where Basic West differs, he pointed out, is in establishing the Web as “an aggressive marketing tool” that involves setting up the page so an individual looking for a line of insurance would be drawn to the agencys Web site through a search engine.

Once found by the insurance buyer, the site, he said, emphasizes the purchase of insurance either through the Web portal, fax or telephone. “Instead of the page saying, Come and see us, it has a come-and-buy attitude,” Mr. Savelli explained.

He points out that the sales system did not develop overnight, and took several years of trial and error to get working. However, even as aggressive a marketing device as Basic Wests Internet site is, it does not catch all visitors, he conceded.

Potential buyers who are just looking for price cannot be compelled to purchase policies online, Mr. Savelli admits, which can still be a drawback to agents. However, so that the Web contact isn't a total loss, for an individual who wants a quote, the site requires the inquirer to give an e-mail address or phone number for an agent to contact.

“There has to be a point of interaction or you are not going to see that person,” Mr. Savelli noted.

One significant Internet success story is Commack, N.Y.-based IMT Services Corp.s Web agency, at www.insuremytrip.com. The agency sells vacation and travel insurance via the Web site, said Jim Grace, IMT's president.

The online niche sales initiative began in 1995 with one company and the agencys Web site selling direct to the consumer, Mr. Grace said. By 1999, after learning the Internets potential, IMT brought two other companies on board to produce a comparison format for consumers to easily understand and access.

One reason for the portals success is that it does not sell the product merely by price, but by coverage. Generally, Mr. Grace pointed out, there are three factors considered by insurers when underwriting travel insurance–trip cost, trip length and age of traveler. Logging this information online produces the policies available and what they cover. The customer then makes a decision based on what he or she needs covered.

Because it is a niche product, it has a niche delivery system where the consumer can compare coverage limits through pop-up windows and see the wording of the policies. The purchase is also completed in real time, and averages out to a premium cost of anywhere between 4-to-6.5 percent of the trips purchase price.

“We empower the consumer; that is what the Internet consumer wants,” Mr. Grace observed.

After Sept. 11, with many people canceling or putting off travel plans, online insurance sales remained flat for a number of months, noted Mr. Grace. Since January, however, sales have grown, with the growth rate at about 20-to-25 percent each month, he added.

The agency will soon be adding its eighth carrier, bringing the total to more than 30 plans consumers can purchase over the site. The portal boasts 500 partner travel and insurance site links, and 100 traditional agents. The Independent Insurance Agents of New York, based in Syracuse, recently signed on through trip-protect.com, a private label search engine for member agents to write travel insurance for clients.

“We do not sell the cheapest product, but one that fits the individual consumer,” Mr. Grace declared. “Thats the way [insurance] should be sold.”

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, June 10, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.