While some people have argued that the Internet is going toreplace insurance agents, it appears that right now, for mostcarriers, the Web is being used as an easier way for customers tofind an agent. In its report-The Internet and Property-CasualtyInsurance: Lost in Cyberspace-Conning & Co. looked atdeveloping direct online sales capabilities and found that the mostpopular task being offered on the Web is locating an agent.

Conning looked at three aspects of the P&C world: personalauto, homeowners, and commercial lines. It examined the Web sitesof the top 20 personal-and commercial-lines insurers based on netwritten premium for 1999. Not surprisingly, more online work isbeing done in personal auto than the other two catagories. Twentypercent of auto carriers offer online sales with the morecomplicated homeowners policies available from just five percent ofthe insurers surveyed. Surprisingly, online commercial sales areavailable in 15 percent of the insurance Web sites, although theseare usually smaller policies.

Finding an agent and helping that agent generate leads are theleading properties of insurance carriers' Web sites. Leadgeneration through instant quoting is available from 30 percent ofauto insurers, only 15 percent of homeowners, and not at all forcommercial lines. In its report, Conning said that insurers areholding back on homeowners quotes because it is difficult enough toget personal auto quotes online. Companies want to get one thingdone right before trying to do too much, and personal auto offersthe most potential. They also believe that managing homeownersonline is more difficult, especially when inspections arerequired.

Not many companies are doing much more online than helpingcustomers find an agent to handle their policy needs. In fact, themain function of 25 percent of personal auto Web sites is to helplocate an agent. It's even higher for homeowners (45 percent), andcommercial lines (50 percent). Of course that beats the 10 percentof commercial lines insurers who are doing absolutely nothing onthe Web.

Conning thinks that insurers could eventually develop specificproducts for the Internet. The report states: “If, as seems likely,the Internet represents a distinct market with specific productneeds, those insurers that tailor products specifically for thatmarket are much more likely to be successful.”