“As far as going direct, it depends on the line of business. When you get into the more complex lines—at least on the property/casualty side—you don’t see [the direct channel], but for the personal lines—particularly personal auto—there is definitely more inclination to go direct.
I don’t foresee eliminating agents completely. We’ve done some Gen Y surveys and one of the things we learned is that while Gen Y wants to research and investigate over the Web, when it comes to purchasing insurance they want to talk with somebody live.
I think there’s always going to be a need for the agent in some capacity. If you are talking personal auto insurance and this is, say, the 10th year with no changes, you are probably more apt to go direct. But once you begin to have different needs in your life and different needs for insurance, you are more apt to want to talk to an agent or broker.
On the commercial side I think it is completely different. There is much more of a need to have somebody professional—an experienced broker or agent—helping you with your insurance needs.
As for producers, they have some choice in what carriers they go to. We also surveyed some P&C producers and one of the things they are most threatened by is insurance carriers going directly to their customers.
Producers have choices in terms of the companies they want to deal with. We found that those producers who communicate the best and feel they have the most input into the process—or are at least asked for their opinion—are the producers that are most satisfied with their carrier and are more likely to place business with that carrier. There has to be a level of trust. There has to be good communication between the two parties. That’s when you can have a win/win situation.”
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