Online Insurance Sales and Marketing: What’s Happening and What’s Next.

Celent projects that online insurance sales will double by 2011, and that the Web will play a major role in most personal insurance purchases across auto, life, and health.

Celent’s latest report, Online Insurance Sales and Marketing: What’s Happening and What’s Next, is an update to its 2002 report, Online Insurance Sales and Marketing: Practices and Profiles. Key findings include:

– The web has become an increasingly important communication channel between sellers and buyers of personal insurance.
– Most consumers’ purchasing process is “Web Influenced”
– Search engines like Google and Yahoo! are critical channels for insurers that cannot afford massive consumer marketing campaigns to drive shoppers directly to their sites, and more insurers are embracing search engine optimization to help capture these shoppers
– Pure online sales are growing, but will still account for less than 15% of sales, even in personal auto.

The report estimates the current breakdown of “Web Influenced,” “Web Initiated,” and “100% online” sales across personal auto, individual life, and individual health sales. “While 100% online sales are unlikely to exceed 30% in any area, the Web will be a major influencer for nearly all sales within five years,” says Matthew Josefowicz, managing director of Celent’s insurance group and coauthor of the report.

The report describes the online ecosystem within which buyers and sellers have a number of ways to reach one another: the interactions can be direct between the consumer and the carrier; through online marketing driven by search engines; and through online agencies or agents’ websites. Insurers need to manage and direct those interactions or risk losing shoppers’ attention to intermediaries that may direct prospects elsewhere.

To demonstrate the varied landscape of online marketing and sales, this report provides snapshots of web activities for top carriers, aggregators, and online agencies in three areas: personal automobile, life, and individual health.

Personal automobile includes: State Farm, Allstate, Progressive, Geico, Nationwide.

Life includes: AIG, MetLife, Northwestern Mutual, Prudential, and New York Life.

Individual health includes: UnitedHealth, WellPoint, Kaiser Permanente, Aetna, and the Health Care Service Group.

Other significant online players profiled in the report include eHealthinsurance, Insweb, and Esurance.

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