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Are Customers Returning to Independents? For How Long?

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A recent poll for a US insurer suggests that a significant portion of insurance consumers who moved from the independent channel to direct marketers are returning to the independents. Good news for Canadian brokers? Perhaps. Sustainable change? Aye, there’s the rub.

Sixty percent return to independents ….

The Hanover Insurance Group, a top 25 US insurance organization, recently commissioned a survey of 1,000 insurance consumers who switched to direct marketers 10 or more years ago.  The study found that 60% of these consumers have switched back to independent agents.

What brought the consumers back?

Insurance&Technology contacted Jim Griesing, VP of marketing distribution and sales for The Hanover who indicated there were two main reasons given by consumers:

  1. Having a single point of contact.  According to Griesing, “They were often buying multiple policies, and wanted to have a live person guide them thru options and give them advice.”
  2. Savings and billing convenience. “The two areas that came up often there was the idea of an account credit if you have your home and auto with one carrier or one agency,” Griesing said, adding,  “The other was consolidating billing onto one statement.”

What will keep them from switching again?

Hanover is clear that the world is a changing place and insurers and agents must continue to earn consumer confidence.  In addition to being a trusted adviser, Griesling notes that the agents must understand the ‘digital experience’.

“Agencies having a web presence with strong search engine optimization and strong branding as part of the model is something we encourage,” Griesing said.  This includes having the capability of handling transactions as well as information.

Does this apply to Canada?

As we noted in this space in June, Canadian brokers are in a slightly better position than their US counterparts, still enjoying support from the majority of consumers.  However, the same pressures will be on them to maintain currency in all communications channels, including digital.

Moreover, the Canadian direct market is substantially different than the US.  The direct marketing incursion in Canada came later than the US, but with more clout (banks).  Ask yourself:  Can banks support a single point of customer contact?  Can they offer discounting and unified billing?

Two things are the same in the two environments, however:

First, Canadian Brokers and US Independent Agents have and enviable track record for exemplary attention to consumer needs, and

Second, like The Hanover, Canadian insurers are looking to its independent broker partners to assume responsibility for customer-facing activates, including digital.

What do you think?

Are the results of the Hanover study good news for Canadian brokers?  If so, is it sustainable?  Let us know with your comments below.

 

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