More Consumers Bypass Agents When Buying Auto Insurance

The insurance agent could end up in the same boat as the fabled Maytag repairman, according to a recent survey.

A Vertis Communications Customer Focus Insurance Study shows that 40% of consumers surveyed would purchase automobile insurance directly via phone, Internet or mail without first consulting an agent, an increase from 29% in 2003 and 25% in 2001. In particular, 45% of adults ages 35-49 are willing to make a direct purchase. That's up from 30% in 2003.

Scott Marden, director of marketing research for Baltimore-based Vertis, says consumers are becoming more and more comfortable using the Internet or automated phone lines. A likely scenario is they may find out about an offer via direct mail, and then act on it via the Internet or by phone. "It's kind of a do-it-yourself mentality," Marden tells Marketing Daily.

Of all groups surveyed, men ages 50-64 and those who are 18 to 24 are most likely to read direct-mail offerings from insurance companies in 2007--23% and 22%, respectively. For women, direct-mail pieces offering insurance services are most popular among those who are 35 to 64, with 15% indicating they would read this type of mail. Least likely to read insurance direct mail are men ages 25-34 and women age 65 and older--9% of respondents in each group.

Customers especially like being directed to customized microsites that speak specifically to their needs, Marden says. Marketers with good databases who have some demographic information about their customers can really make use of it with this approach, he says.

There is currently a good opportunity for marketers to reach adults ages 50-64 via e-mail, Marden says. Many consumers in this group are "late adopters" to getting computers and getting on the Internet. The newfound fascination with computers and the Internet makes them more receptive to e-mail solicitations now than they will be in a year or so, he adds.

Although they may initially choose to bypass the agent, when they do have to deal with them, consumers want agents who know what they are doing. An insurance company possessing a knowledgeable agent or representative continues to be the most important insurance service to 27% of all adults in 2007--up just 2% from 2003.

Accessibility is also important, especially to young adults ages 18-24, who said having 24/7 access to an insurance company is the most critical service (29% in 2007 from 23% in 2003. Value of online access to an insurance company has risen most drastically over the years among adults ages 25-34, from 2% in 2003 to 9% in 2007.

Next story loading loading..