AVON, CONNECTICUT, USA (May 20, 2003)�Pursuing alternate channels for distribution (e.g.: banks, Internet intermediaries, affinity groups, credit unions, employee leasing organizations, and P& C institutions) seems to be a common strategy today among worksite carriers, according to a recent study by Eastbridge Consulting Group, Inc. And predictions are that these channels will play an even greater role in the future.
“About half of all the companies responding to our carrier survey said that they are currently pursuing a distribution channel that they consider to be an “alternate” channel (channels other than their primary channel),” comments Eastbridge vice president, Bonnie Brazzell. “Even among those that are not pursuing alternate channels, half said that they plan to but have not yet had the time to do so.” It appears that insurance companies are concerned that traditional channels alone will not provide the growth levels they expect and need.
“Association/affinity groups and credit unions are the most commonly pursued alternate channels today,” adds Gil Lowerre, president of Eastbridge. “But when we look at channels that are currently being pursued plus those that are most likely to be pursued in the future, associations and banks rank first and second respectively. Internet intermediaries are third, followed by credit unions.” Also noteworthy was the fact that those most active in alternate distribution are primarily very large companies with multiple lines of business (voluntary, traditional group, P&C, etc.).
We also learned that alternate channels have certain expectations of their carrier partners. “Carriers can’t just announce that they are pursuing alternate channels and expect to be successful,” say Brazzell. “Carriers need to carefully research the channel (especially its needs and expectations), and then develop an approach that distinguishes itself from competitors.”
What are the “secrets to success” in pursuing alternate channels? This and other questions are the subject of Eastbridge’s newest study, Alternate Distribution Channels for Worksite Sales. The report explores the current and potential opportunities for these channels from two perspectives: carriers and those currently representing alternate distribution channels. From the carrier perspective, the study looks at:
- The possible alternate channels for worksite marketing sales
- How carriers currently use these channels
- Which channels are producing sales�and why�and which ones aren’t
Additionally, the study provides direct feedback from alternative channel representatives including how interested these individuals are in worksite product sales and, perhaps more importantly, what they expect from their carrier partners.