Are You Ready for Insurance Dot Com?

The insurance agency system is experiencing an explosion of new ideas and techniques as well as a changing insurance environment. Agencies must look for new ways to take advantage of the new market forces sweeping through the industry and society. One of the most important opportunity areas is the Internet. The potential for Internet growth is enormous.

Unfortunately, many in the industry are fearful and confused about the Internet. Someone who wasn't is Gordon Harden, an agent in Ownings Mills, MD. Gordon is a leading expert on Internet insurance marketing. He realized early on that computers would play an increasingly powerful part in day-to-day agency operations. He saw the need to change his agency's direction in response to the shift in the way customers do business with agents and insurance companies. The old marketing methods-door-to-door canvassing, direct mail, and telemarketing-just weren't working as well as before.

The more Gordon used the Internet, the more certain he became that this was where he'd find the prospects to make his agency grow. He seriously researched the Internet, hardware, and software-and the ways these technologies could be used together to operate his agency. He found the Internet to be a great icebreaker with hard-to-reach prospects. Once he establishes contact, most prospects and customers he finds through the Internet are more than willing to talk about insurance face to face. Using the Internet allows Gordon to:

• Continuously increase new business writings
• Attract new multi-line clients
• Attract hard-to-reach clients
• Generate an outstanding bank of X-dates
• Build a sales bank six to 12 months ahead
• Reduce his agency expenses

INTERNET CUSTOMERS

The Internet has not only changed the way agencies and insurers do business, but presents them with a new kind of customer. Today's insurance customers are:

• Younger as a group (21 to 35)
• Harder to reach as clients
• Less receptive to cold calling
• Technically advanced and better educated
• Experienced in using the Internet
• Comfortable buying on the Internet

The most compelling reason for agents to use the Web is to convert these "cyber-prospects" into traditional policyholders. Currently substandard Auto, Health, and Term Life coverages offer the greatest potential business-but remember, the Web is tomorrow's window of opportunity.

Think of the Web as a worldwide collection of interconnected pages that are often linked to other pages. The links are highlighted for easy recognition and are easily accessed by the click of the mouse.

HOW WIDE IS THE WEB?

Many agents wonder about the scope of the Web. Here are some of the facts:

• The Internet is growing faster than all other technologies before it. Radio took 38 years to attract an audience of 50 million. Television reached that mark in 13 years. The Internet attained that many users in just four years.
• Three million people were connected to the Internet in 1994. By the end of 1997, 100 million worldwide were using it, including 62 million Americans.
• According to the Associated Press, "traffic on the Internet is doubling every 100 days, with business use growing the fastest."
• An American International College survey of Forbes 500 CEOs found that "they fully expect 40% of their annual sales via the Internet within the next 10 years."

Clearly this new way of marketing is taking hold. Service industries need to be prepared to work and serve in this environment-or else be left out in the cold.

THE FUTURE

What changes will the Internet bring for agencies? Notice the changing landscape in the other high-end sales industries:

• Real estate agents need a Web presence now that people can view houses and decide which ones they want to see before they call. Radical changes are sure to come.
• Car manufacturers have Web sites that allow prospective customers to "shop" -- view the cars, check the available options, look up trade-in values, and estimate their payments-before deciding where and what to test drive or buy.
• Stock brokers are finding that online stock purchasing is the fastest-growing segment of the financial industry.

Should insurance be different? Consider this: Clients used to find someone to answer questions about insurance through the phone book. Today clients can find the information they need on the Internet. Smart agencies will be there to answer their questions-and write their business. The Yellow Pages has lost value and identity in recent few years. Agents can fall behind just as quickly while the Internet evolves.

Why else would insurance carriers rush to put promotional sites on the Web-sometimes giving agents a tag line or two? Company survival in the 21st century dictates that they invest their resources in areas that promise future returns.

GETTING A WEB SITE

Let's get into the specifics of setting up a Web site. You have several options.

• Tag on to an affiliated company site. These companies offer information-only pages almost exclusively. If interactive quoting is available, it generally goes to the company for distribution and not directly to the agent. The pages are professionally produced and inexpensive for the agent. Most companies don't allow customization or changes, so there's no way for an agency to promote these pages through Internet search engines.
• Write the site yourself. This is the most inexpensive option, but a difficult task for most agents. Your personal Internet pages need to reflect a personal look. This isn't to say you can't do it-but we don't recommend it unless you're skilled in HTML programming.
• Get a free page. Some Web hosts, such as America Online, Angelfire, and Tripod, offer free space where you can build a site based on their page templates. Generally, they're for personal site use, but many small businesses also use them. These hosts offer no support or technical help. Some assign a page name that makes it all but impossible to identify an agency. The agent is responsible for all promotion. Using this type of site is much easier than writing your own-but you must have Internet knowledge to make it work satisfactorily.
• Use a Web publishing company. This is the easiest way-and the most costly. Web companies will set up a professional, custom site, provide you with E-mail accounts, and secure your domain address. All this, plus any changes, comes with maintenance and server costs that may seem prohibitive over an extended period of time. With a professional published site, you can have almost anything you want-but remember, you're selling insurance! Your publishers should know your industry. An insurance Web site needs a set-up much different from one that uses animation and graphics to sell hot sauce. Those flashy-but slower loading-techniques won't improve your site. Internet users who want information quickly won't waste their time waiting-they'll jump to another site. You need to make your point the instant you have the customer's attention.
• Get listed on an insurance-exclusive service. You might consider an insurance-exclusive service company, such as InsuranceQuote.Net. These offer low-cost, template-based insurance sites built for fast access and interactive quoting. Agency information is individually customized and listed by state, and-most important! -- site promotion is part of the service. Most agencies, regardless of size or location, will generally find using insurance-exclusive service companies to be cost effective and productive.

The Internet isn't a fad or a toy-it's serious business, and its customers are here. Agencies that plan to prosper in the 21st century need to move onto the Web to serve those customers.