Although the “insurance industry is still hoping for the Internet to go away,” the exact opposite is happening as more Web users visit insurance sites and a greater percentage turn first to the Internet when they consider buying coverage, a new survey has found.
“NetSmart V—America.com: What Makes America Click?” a survey of 1,000 people nationwide who spend at least one hour a week on the Internet at home, reported that while the number of visitors to insurance Web sites surged, almost nine out of 10 of those visitors left the sites “out of frustration.”
National Underwriter obtained exclusive details of the marketing survey’s results, which will be available on June 1.
The number of respondents visiting insurance Web sites surged from 11 percent in 1998 to 19 percent this year, the survey found.
Moreover, 78 percent of respondents this year said the Internet was the first place they went to when “thinking of buying insurance,” compared to 47 percent last year.
However, the vast majority of insurance site visitors left unfulfilled. They reported leaving the sites for the following reasons: Out of frustration (89 percent), because they could not find the information they wanted (74 percent), getting the information took too many clicks (74 percent), the text style used on the site was hard to read (51 percent), they got lost in the site (50 percent) and there was no interactivity (42 percent).
“Insurance sites are the most poorly designed of any sites on the Internet,” said Bernadette Tracy, president of New York-based NetSmart. “The problem with insurance sites is that most of them are little more than “brochureware.” They are not leveraging the interactivity—the core strength of the Internet—to create interactive relationships with customers.”
On the Internet, “people buy solutions to their problems, not products,” she added. “What the insurance industry is doing [online] is selling products, not solutions.”
She noted that “property and casualty invokes the strongest insurance interest.” The survey found that if security issues were resolved on the Internet, 29 percent of respondents would buy property-casualty lines, compared to 24 percent who would buy life and health policies. And 5 percent of respondents said they had already bought insurance online.
Insurers had better get Internet savvy or risk losing market share, according to Ms. Tracy, who pointed out that 55 percent of respondents were willing to buy insurance from a bank “either online or bricks and mortar.”
“This is a wake-up call for the insurance industry,” she cautioned. “Overall, insurance sites are setting themselves up to be killed. If they don’t step in, the banks or insurance start-ups will beat them to the punch.”