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March 17, 2015 at 03:00 AM
The verdict is in: Social media is good for business.
Countless anecdotes and case studies have been published showing significant branding and sales results achieved by professionals in industries across the board, once they begin engaging with clients and prospects through social networks. In fact, according to Accenture, 55 percent of insurance customers say they would use insurance services offered through social media. Despite that hard and fast evidence, widespread adoption of social media by insurance professionals is still lagging behind other industries.
The reason for the lag can be summed up in a single word — one that’s very important to any advisor in the insurance or financial services space: Trust. It’s not that advisors don’t believe that social media is a channel for relationship-building and prospecting. It’s a trust gap on the security, compliance and brand reputation fronts that is limiting widespread adoption.
The breakdown in trust of social media programs comes from a number of angles. Each point of contention can give a member of a firm’s C-suite or broader employee base heartburn and result in hesitation or even outright dismissal, based on perceived risk/reward.
1. Kinks in the chain of trust start on the ground floor
A foundation or lack of trust starts at the “producer” or advisor level. Employees who work in regulated industries are often quoted as saying that they don’t trust they won’t make a wrong step when using social for business, and they value their license and their reputation above all else.
It’s hard for them to internalize and keep up with industry regulations as well as the constant changes and updates rolling out from each social network, and they don’t accidentally want to be the cause of a gaffe that brings sanctions against them or their firm. After all, a recent report from the non-profit Online Trust Alliance showed that 29 percent of data breaches occurring in the first half of 2014 were simply caused by employees, rather than external hackers or forces.
There are safeguards and software solutions that can prevent compliance violations and breaches, and their most essential function is making it easy for advisors to use social and trust that they are remaining compliant with firm and industry regulations.
2. Easing compliance and security concerns
From the converse perspective, chief compliance officers, risk professionals and legal teams are constantly concerned about an employee (intentionally or not) crossing the often fuzzy legal lines of what is permitted when producers take to social media. They’re used to having technological “allies” to help them keep human tendencies in check with the confines of stringent regulations.
They have those technological allies in the social sphere too, with multiple social compliance platforms having developed various content recommendation, monitoring, archiving and moderation features tailored for various vertical markets, including insurance.
The CCO shouldn’t feel alone or powerless in his or her mission of creating a sense of trust between themselves, informed employees and clients who are none-the-wiser that a technological safety net is in place.
On a similar plane, a firm’s IT or security team, led by the CIO or CSO, knows that social media can often be a lightly guarded in-road for cyber attacks if left unaddressed. A risk alert recently issued by the SEC states that 88 percent of broker-dealers and 74 percent of RIAs have experienced cyber attacks.
Numbers are likely similar in the insurance space and IT decision makers may be wary of any single solution or platform that claims to help shore up potential pitfalls that social creates.
Understandably, those tasked with protecting the company’s data don’t want to open up more channels or opportunities for vulnerability, but trying to approach cyber-security by denying social use altogether is not practical for the long term.
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