- Where Insurance & Technology Meet

Canadian On-line Insurance Activity: Leading May Be Rewarding and Award-Winning

New data and analyses suggest that Canadians are more active than most in on-line activity, and do a respectable amount of buying, but are lagging behind Americans in on-line insurance purchasing. However, there are indications that Canadians are prepared to catch up. Some leading Canadian insurers and brokers are already preparing, and may find their efforts are ‘award-winning.’

We’d like your thoughts.

Up North of 44 …

Recent analysis by Catherine Kargas, VP at management consulting firm MARCON  suggests that Canadian consumers spend a significantly greater amount of time on-line than their US, UK, French, German and other counterparts.  And these consumers use the Internet to buy, spending $15 billion dollars in on-line purchases in 2010.

So what about insurance activity?  Kargas cites a study undertaken in February 2012 by Secor and Opinion Search to show that a strong percentage of Canadians generally, and Ontario residents specifically (26%), use the Internet to research insurance products and services  However, this does not translate to new purchases.  Less than 3% of the on-line purchases were for insurance.

Moreover, Canadian attitudes don’t currently favour on-line insurance purchasing.  The Secor and Opinion Search study indicates that  “purchasing automobile insurance over the Internet is identified as ‘probable’ by 7% of Quebeckers, 9% of Ontarians and 6% of Albertans,” according to Kargas.

Meanwhile, in the U.S. …

According to a recent J.D. Power and Associates survey, a significantly higher (than Canada) percentage of US insurance shoppers (52%) begin their searches on-line.  And American are keen to complete the transactions on-line.  According to the J.D. Powers release, “32 percent of customers solely obtain quotes online, and today 34 percent of all recent shoppers state they would most prefer to purchase their new policy online.”

So, What If ….

What if Canadians’ enthusiasm for  on-line purchasing starts to include insurance? Kargas suggests that there are opportunities here for Canadian insurers generally and Canadian Brokers specifically.  She writes, “The fact is that consumers generally consider the purchase of insurance as ‘complicated’, and this despite the fact that they normally purchase this product annually. For this reason, Canadians prefer to consult an insurance professional prior to concluding the purchase.”

This seems to support the personal, professional touch.  Further, it should further favour the broker, who has access to the best product at the best price. Except for one big wrinkle.

Jeremy Bowler, senior director of the global insurance practice at J.D. Power and Associates, commenting on the results of the US survey, writes “Shoppers now expect to be able to visit an insurer’s Web site and complete their purchase in the same visit.”  He adds, “In most cases, shoppers can compare many policies online and narrow down their search field entirely via this self-service paradigm. From that point, they can then decide if they need to speak with an agent or to continue their online purchase process.”

Kargas’ analysis support this.  The greatest advantage Canadians perceive in purchasing auto insurance on-line is not price, but convenience.  And the third greatest for Ontario consumers is 24/7 availability.

Perceived advantages of purchasing auto isurance online

Rewards and Awards for  Canadian Insurers and Brokers Who Prepare…

Leading insurers and brokers are not sitting idly by.  While we don’t have a scientific poll on this, the nominations and finalists for  the 2013 Technology Awards focus on improving the consumer on-line experience.

For example, two finalists in the distributor category – Square One Insurance Services and The Shepherd Group have developed and deployed technology and marketing programs to integrate on-line with personalized service.

In the insurer category, CAA has invested substantially to integrate its on-line services to improve the on-line experience of its members and customers and differentiate their offerings in the market place.

You can visit with these nominees and the suppliers that assisted them by attending the ICTA Awards Ceremony and Reception on the first day of the 2013 Technology Conference, March 18-19, 2013.  Details on registration can be found here.

 What Do You Think?

Do you see Canadian insurance consumers moving to the on-line environment?  If so, how well do you see Canadian insurers and brokers re prepared?  Leave your thoughts below.