Potential of Policy Binding on Agent Websites

[Brian Anderson]

The National Association of Professional Insurance Agents (PIA) recently announced it will conduct an “industry discussion session” in January to flesh out the concept of agents offering a level of purchasing capability on their websites.

According to a release about it (link below), there is ongoing discussion within many different circles – agents, companies, vendors, user groups, etc. – about the inability of a consumer to bind a policy on an agent’s website. Currently, many agents have a comparative rater that offers a quote, but should a consumer like the quote, they can’t bind the policy unless the agency is open for business.

“Creating an option for independent agencies to offer a ‘buy button’ on their websites could open doors to a new segment of business,” said PIA National Executive Vice President & CEO Mike Becker. “Likewise, there is significant concern that going too far with digital operations could undermine the value proposition of having a retail operation and a personal relationship with one’s insureds.”

Becker said that PIA decided on a structured conversation among all stakeholders, with agents at the table. “On the carrier side, while many see the upside, some carriers are noting other hurdles, such as paying for MVR fees,” Becker added. “User groups and vendors that can create capabilities also have a role in discussing the various technical aspects, but the focus must always be on the agent.”


PIA Calls Industry Meeting to Discuss Potential of Policy Binding on Agent Websites

 

[insurance1822]

What makes you an "Executive Editor" with only 201 posts?

 

[HCCIA]

I say hell NO! As independent agents we are so much more than a "buy" button. I've had a quote option on our website. The client completes several fields and gets a quote. We followed up once we were notified. 99% of the time. They were way way off! The client put bogus info in, they didn't put enough information in to get accurate quotes. They were getting quotes hundred if not thousand wrong. Most of the time much higher. We would re-work the quotes. Add the proper credits and call them back with an accurate quote. Most times they never even answered the phone or responded to the email.

We decided to pull the quote engine off-line and in its place put a simple form with just basic info. We then added it to our comparable rated and called them to finalize. Found it was much better.
Most of the time it was crap business looking for a quick quote. Not what I'm looking for anyway.

Sure there may be a need for this for a small segment. Not the clientele I'm looking for! They can call Flo!

 

[somarco]

What makes you an "Executive Editor" with only 201 posts?

I believe Sam, the guy that owns this forum, is the one who did that.

 

[rbadoux]

Having client's bind coverage poses a huge risk to both the consumer and the agent. There's a reason why a licensed professional must verify the information to prevent bunk policies.

However there are some P&C products that rate based solely on credit score. Leaving little to no room for misquoting. This is definitely do-able.

 

[AZDave]

Give me a Buy Button! I want one. I want one that works perfectly for the customer, the insurance company and the agent. For the customer, the rate will not change, the transaction will be quick and easy, paid for and bound. They will have understood all the coverage, and will not need to call me for any questions. However, they will feel good that there is an actual agent behind their purchase.

For the insurance company, they will feel good that all the proper underwriting and scoring is accurate and complete. The policy is priced, understood and accepted by the customer. The chance of fraud and bogus policy would not be an issue, because this Buy Button has all that taken care of.

For the agent, we will feel great! Every time the customer hits that Buy Button, the "cha ching" sounds on your computer and phone! All the document retention requirements have been met. By the time the customer has hit that Buy Button, they have also created a sign in account directly with the insurance company so the can easily and readily access id cards, billing information, etc. They may not ever even call the office.!

I want that kind of Buy Button!

 

[BlockO]

Give me a Buy Button! I want one. I want one that works perfectly for the customer, the insurance company and the agent. For the customer, the rate will not change, the transaction will be quick and easy, paid for and bound. They will have understood all the coverage, and will not need to call me for any questions. However, they will feel good that there is an actual agent behind their purchase.

For the insurance company, they will feel good that all the proper underwriting and scoring is accurate and complete. The policy is priced, understood and accepted by the customer. The chance of fraud and bogus policy would not be an issue, because this Buy Button has all that taken care of.

For the agent, we will feel great! Every time the customer hits that Buy Button, the "cha ching" sounds on your computer and phone! All the document retention requirements have been met. By the time the customer has hit that Buy Button, they have also created a sign in account directly with the insurance company so the can easily and readily access id cards, billing information, etc. They may not ever even call the office.!

I want that kind of Buy Button!

What a brilliant display of sarcasm. Bravo AZDave.

 

[INSUREGEEK]

Until buyers become attorneys or licensed agents capable of reading and understanding legal insurance contract language.......

I can't wait to see the first case in court!

 

[raphaels]

this is a very interesting topic!
I'm going to ask some questions here, and I'm very green to the insurance industry, please feel invited to educate me.

I understand that there are potential agency liability issues, but if those were rectified- why else wouldn't the agent welcome this?

I'm having a hard time understanding why this is viewed negatively by agents, wouldn't this type of automation allow an agent to minimize their efforts in regards to certain PL sales?

It makes sense that these 'shopper customers' are often not worth the time, but isn't a single-line auto sale without a significant marketing spend- a valuable cross sale opportunity w/high ROI?

I'm a millennial consumer, i buy online, i undervalue the relationship between myself and my insurance agent. That being said, I also read what you guys (the regular contributors to this forum) say: relationships are key, communication is key, cross selling is key, regular-consistent prospecting is key. So if i'm a millennial who needs auto insurance, and i don't WANT to talk to my agent before buying an auto policy, isn't allowing me to do so in the Agent's best interest? I probably don't know what insurance policies i should have besides auto, after i buy it online- isn't this the opportunity for an agent to educate me?

I hate that my agent doesn't try to sell me more, i think it's lazy. I know that i'm no 'big fish', but isn't my agent in it for the long haul? I've read so much of what is said on here, i know that many agents think about the long term impacts of their customer relations, isn't the 'buy button' a doorway to building those relationships? I plan to be a millionaire with lots of cars, vacation homes and a personal jet, but today i'm a millennial who doesn't know anything, i just need proof of insurance for my glove box, isn't this where the relationship could begin?

 

[HCCIA]

Statistically, it is not great business in my opinion and experience. You may be the exception. I value the quality business that we do get. Our profit sharing (6 figures) depends on quality business.

Once an account is on the books. It is pretty hard to "fire" them.

Here in MA, independent agents write about 75%+ of the business. Direct writers just started knocking on the state's doors a few years ago. For the most part they are writing that class of business that I don't want.

Times are a changing. I see a lot of people getting quotes online or researching agents then coming in to finalize and buy. Only about 5% are people I never meet and everything is done electronically.

I do see the whole buy button concept coming in the future. Just not now and not here in MA. People really value the face to face experience.

The accounts I do lose to Flo or the Lizard eventually come crying back. They don't get the same personal service.