Most Life Insurers Still Without Focused Retail Internet Strategy
(Hartford, CT) June 4, 2001 — The life insurance
industry’s allegiance to the agent ‘face-to-face’ sales approach has discouraged many life
companies from designing consumer-focused Web sites – even though consumer-oriented Web
sites can be useful for agents to increase sales, according to a new study from Conning
& Company. Further, the lack of creative content on many public life insurer sites has
reinforced the impression that life insurance is sold and not bought, thus depriving life
insurers of one more tool that they can use as they fight to maintain their brands against
increasingly aggressive financial services competition.
According to the new Conning study, “Life Insurer Web
Site Assessment: Opportunities Abound,” many life insurers have created Web sites
primarily as placeholders to establish a retail presence on the Internet, not to meet
their strategic goals. Further, life insurers appear to have measured their Web site
capabilities against their peers; they need to expand this focus to include Web sites of
other financial services firms.
“Life insurers were so concerned with pursuing a
retail Web strategy that would not conflict with the role of their agents that they missed
an opportunity to develop Web sites that could help their agents,” said Elvin Turner,
Vice President at Conning. “Life insurers need to use their sites as an educational
tool that both helps the agent close sales and that validates the agent’s message for the consumer.”
Conning analyzed life insurers’ retail Web sites in four
major lines of business (individual life, individual annuities, group life and group
annuities). The assessments are based on the insurers’ overall ability to use their Web
sites to meet specific challenges within their business.
Individual life insurers have developed functionality such
as agent locators and online lead-generation tools, but, for the most part, they have not
done enough to interest and engage customers who will use these tools. These tools have
not been marketed properly because of insurers’ fears that the functionality would
undercut the field force’s sales efforts.
Some individual annuity insurers have enhanced their Web
sites with a number of online asset management capabilities. Despite the enhancements,
these insurers could do much more. While many insurers are spending massive amounts of
money on direct electronic connections with key distributors, they are not fully
developing retail Web sites that could also play a significant role in distributor sales
support. Further, few insurers use the Web effectively to market themselves to potential distributors.
Most group life companies do not appear to have any retail
Internet strategy. Group life Web sites contain limited functionality and content. Only a
few insurers are attempting to develop new online distribution capabilities by using their
retail Web sites for online enrollment of their voluntary products.
For the most part, group annuity insurers have been the
most effective of all the lines in meeting the specific challenges of enhancing their
products by adding Internet participant service features and reducing administrative costs.
Conning notes that, regardless of product line, most
insurers are still grappling with how to incorporate their retail Web sites into their
overall business strategies. In general, life insurers have yet to advance beyond basic
Internet functionality and a minimal level of content. The few insurers who have made
progress have an opportunity to use their Web site capabilities to great advantage.
The Conning study, “Life Insurer Web site Assessment:
Opportunities Abound” is available from Conning & Company for $575 by calling
toll free (888) 707-1177 or (860) 520-1245. A complete listing of all Conning Strategic
Studies can also be found by visiting the company’s Web site at
About Conning & Company
Conning Corporation, through its subsidiaries, provides
asset management services to insurance companies and institutional investors, manages
private equity funds investing in financial services companies, and conducts in-depth
research on the financial services industry. Conning & Company (member NASD/SIPC) is
located at CityPlace II, 185 Asylum Street, Hartford, CT 06103.