Although most financial professionals are aware that consumers now do a large amount of research online prior to purchasing insurance, the finer details of client Internet usage remain mysterious. That handicaps financial professionals who want to find better avenues to reach consumers and address their needs.
LIMRA conducted a large-scale survey of consumers’ Internet habits that promises to give financial professionals an in-depth look at how the Internet factors in to the insurance purchase process. Predictably, the majority of consumers use online resources to learn about insurance products. An improved understanding of how that research leads to decisions should help financial professionals directly engage the consumers who use the Internet most and those who are less digitally savvy.
How are people interacting with the Internet?
LIMRA’s findings divide the insurance buying population into three groups, each of which has a different relationship with the Internet and other digital tools. Interestingly, every group incorporates some type of human contact into their purchasing habits, so fears that the Internet would completely supplant the financial professional’s role have clearly been overblown.
So-called “channel switchers” represented the biggest group in LIMRA’s survey, with over 50 percent of respondents falling into the category. These individuals are very comfortable using online tools, and will definitely conduct research online. While some people within this category might purchase their policies online, the majority will want to speak with a financial professional to complete their transaction. This is the wealthiest group in LIMRA’s findings, and they seem confident in their understanding of the Internet and the products available.
A smaller portion of the group composed of “digital demanders”, a younger group of respondents who expect companies to provide a way to interact on the Internet. While this group expects to have access to online resources, they don’t completely ignore human guidance. In fact, these individuals may need more assistance from financial professionals, because they are young and may not fully understand what life insurance products they should be looking for.
The final group is the least likely to use the Internet, and makes up around 20 percent of the population. This portion of consumers has the lowest income and is the oldest. They barely use online services and still conduct their insurance purchases through in-person interactions.
How to reach out
Channel switchers and digital demanders represent a prime target for financial professionals who want to expand their client base. If a financial professional acts as a key source of information now, these digital demanders may seek out more information from that financial professional when they have more capital to invest.
According to Entrepreneur magazine, it’s crucial for businesses that are advertising online to have a target audience.
That focus shouldn’t come at the expense of in-person interaction, however, and the Internet can actually facilitate this as well. Because every group seems to have a bias toward in-person communication during the final purchase process, financial professionals should make it easy for consumers to reach out and speak with a human. Websites should be educational and do not necessarily need to have a direct sales message. The final sale is more likely to occur in-person or over the phone, where a financial professional is able to apply their expertise to a client’s specific situation.