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The Changing Face of Auto Insurance: Websites to Prices

Posted By Administration, Tuesday, May 31, 2016

Many PIA Western Alliance members focus on commercial insurance. And most of those policies are negotiated and placed in person or on the phone. However, many of you also sell personal lines insurance.


If you do, your customers may be unhappy with how your website works or how the website of the insurer you send them to works. Or so says a new study from J.D. Power and Associates. And while the focus of the study is insurers doing direct writing, much of the consumer discontent may apply to your website as well.


The study is the 2016 Insurance Digital Evaluation Study. It checked in with 3,854 online shoppers who posted 3,340 reviews of auto insurance websites. The results are based on a 500-point scale.


The websites critiqued — to give credit where credit is due — saw some improvement at an overall 7.4%. But customers found some tasks difficult, if not impossible:


  Printing a new or replacement ID card

  Requesting a new or replacement ID card

  Updating profiles

  Adding a driver or a vehicle to the policy


And Valerie Monet — the director of insurance practices at J.D. Power — said the speed of the quoting process and paying the bill online exceeded just one-quarter of the respondents expectations. We find insurers are focusing more on digital and on the quoting experience. Digital channels can improve their ability to acquire more business and help with simple needs. Customers won’t always dial into a call center for help so its vital insurers ensure their tech is ready before they push people toward it,” she said.


The biggest problem insurance websites have is the ability to communicate policy information to a new or existing customer. Nearly a quarter of those responding said they did not fully understand the policies offered on a website.


Companies are still struggling to communicate some of that more complex information to customers. They must find ways to educate people and make it easy for them to find what they are looking for. It’s vital for insurers to remember customer perceptions are set by other websites they use regularly, such as banking or shopping sites,” Monet said.


Websites aside, the face of auto insurance is changing. A new report from Deloitte Consulting titled Insuring the future of mobility: The insurance industry’s role in the evolving transportation ecosystem claims the new mobility ecosystem is wide-ranging and complex and it will touch nearly every part of insurance.


The report looks at insurance’s role in the new system and predicts the evolving needs of customers and products to serve them will provide new insurance opportunities and do away with some traditional ones.


The result will be a reduction, reallocation or elimination of a “substantial amount of today’s insurance premiums.”


Here is some of what Deloitte predicts we’ll see:


  A drop in the total number of vehicles on the road because of more car-sharing and ride-sharing.

  Claim frequency declines as autos become more automated and — as a result — safer.

  Shifting away from personal auto policies to commercial auto policies and product-liability insurance for shared autonomous vehicles.


As a result — the report notes — total auto insurance premiums could drop as much as 30% from the current level. Frequency of loss events and a decline in the total number of vehicles on the road will be the cause.


And then there’s self-driving vehicles which will do away with some traditional insurance products and — ironically — add new ones. As an example, product liability policies will be one area of increase and personal auto a decrease.


Deloitte said this will also have a huge impact on insurance distribution channels. That’s you — the independent insurance agent and agency. In the next decade you’ll begin to see these changes. When they will occur it will be quickly and will be permanent.


Lastly, the reports … authors looked at the direction and rate of change and determined it will come about due to a number of factors:



  Social attitudes

  Technological development

  Privacy and security concerns

  Key stakeholders’ level of resistance


The Deloitte report concludes — to reach the distinctive new needs of personal and commercial customers — insurers will have to modify products and services and their approach to marketing and business models.


Source links: Insurance Networking News, PropertyCasualty360.com

Tags:  Insurance Content  Insurance Industry  Insurance News  The Changing Face of Auto Insurance: Websites to P  Weekly Industry News 

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