Insurance in the 21st century: Demanding convenience, clarity, speed

Agents, Weisbart adds, aren’t making that connection with their customers, and it’s driving them to online sources of both information and coverage. Sandquist sees that as a problem of focus. “Many insurance companies have, historically, been product-oriented or distribution-oriented. Moving to a customer-centric mentality is a bit of a change.” Still, he says, it’s a transformational shift that they need to undergo.

It’s also a shift that comes with a few road blocks. Weisbart says the life insurance industry has two problems it needs to overcome. The first is getting consumers interested in the product. “People can think of plenty of other things to do with their money,” he says. Second, consumers are inundated with offers. “There’s a lot of competition for those dollars,” Weisbart adds. “It’s important for agents and customers to understand how important this stuff is.”

Because consumers typically don’t have an abundance of discretionary income, Weisbart says the life insurance industry has always struggled to connect with the middle class buyers. Not a new problem, he says, but certainly a big concern for agents and insurers. However, he points out another road block getting in the way.

“Even if you can get someone’s attention and have them in a mindset that makes them willing to consider what to do here, this is a difficult subject,” he says. Plus not everyone understands the financial impact of their investments, he adds. “There is quite a bit of evidence that a large number of people are, relatively speaking, financially illiterate. They just don’t understand a lot of key concepts to making sense of life insurance, the main one being that they don’t have much of a sense of a future financially.”

Still, customers aren’t closing the door on interactions with their agents or insurers. Sandquist says part of the Accenture research that didn’t make it into the survey showed that segments of customers actually preferred using agents during the entire buying process.

Some consumers, he says, tend to be multi-channel in their approach to buying, but reach out to an agent to get more information, guidance or to make the purchase. Sandquist says this could be a real opportunity for insurance companies to align their channels to provide a seamless experience to those types of consumers.

Capitalizing on need

That kind of behavior is where true opportunity lies for agents and insurers, the experts say. As consumers become more comfortable around digital channels, life insurers are poised to take advantage of the digital connection with customers and play it to their benefit. Nichols is confident that even in the digital aspect of a consumer’s search, agents can and should be present and providing that sought-after information.

“You can pull them in to your website and give them access to all the necessary resources,” he says. “Alternatively, I would also provide in-person experience and position myself as an expert or a resource for financial literacy.” In that way, Nichols believes the agent and advisor will not be circumvented. He says the value of the adviser is “king” in the consumer’s buying process. Some of the questions agents and advisors can answer, he says, are “Do they have the right purpose? Do they have the right beneficiary designation? Is it in a trust or not? All of these issues are not anything you can take for granted. It’s not like buying a loaf of bread – there’s a level of complexity that affects not just the insured but those they love and future generations,” Nichols adds.

Selling consumers on that level of service isn’t difficult. It takes a little relationship-building and a bit of ingenuity. For example, when Weisbart was a college professor years ago, he was involved in a research project. The project had the team interviewing 25 outstanding insurance agents. Weisbart still remembers one agent’s sales tactics.

“He would make an appointment to see a married couple and would go to their home. He would tell the husband to sit opposite his wife. He’d take his finger in the form of a little gun. He’d say to the guy ‘Bang, you’re dead.’ He would then turn to the widow and say ‘Now let’s go through the estate taxation form that you have to fill out.’ He almost never left without a sale.”

In that scenario, the agent was able to impart the importance of the life insurance policy and align himself with the consumer as a trusted advisor. To those customers, life insurance had suddenly become a much-needed commodity. That’s the value of the agent, in Nichols’ opinion. “We have the education, the training and the knowledge to provide that information and give the consumer the comfort and financial security to protect them and their loved ones,” he says.

Also, Nichols says that disruption in the market in the form of mobile payments, e-signatures and the like are technologies the industry can embrace because, he says, they won’t detract from the agent’s purpose. “Our purpose will never be disrupted.”