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LAS VEGAS --Insurers focusing on younger customers must developsimplified products and rely less on their sales force and more ontechnology, according to a group of experts speaking here at theACORD/LOMA Insurance Systems Forum.

Changes must also be made to reach a growing Hispanic customerbase, the group counseled.

The sales focus of insurance companies is moving away from babyboomers and toward generation X and Y buyers, Matthew Josefowicz,director of insurance at Novarica, said at a session yesterdaytitled "Right or Wrong: Top 10 Analyst Predictions."

He said there are questions as to how receptive these new buyerswill be to complex life and annuity products, particularly productsthat require education from a sales force.

Mr. Josefowicz explained, "One of the interesting trends we seeon that side of the marketplace is that generations X and Y are notnecessarily interested in being educated by a salesperson. Theywant to educate themselves. They feel like they should have thetools at their disposal to educate themselves about the productsand services they buy."

He added, "They expect there to be comprehensible informationabout the product and about product value available to them withoutgetting into a sales situation."

Kimberly Harris-Ferrante, research vice president, GartnerResearch, noted that younger generations are going to the Internetfor education on products and services. In particular, she saidthey are going on social networking sites where insurers havelittle to no presence.

As to the implications of this generational shift, Mr.Josefowicz said, "I think we're going to see more simplification"of products, and a greater focus on finding ways beyond a salesforce to communicate the value of wealth management products toyounger generations.

Insurers in both the life and p-c sectors will also need to moveaway from mass-marketed products and toward unique products gearedmore to the individual, Ms. Harris-Ferrante said.

"I think there is going to be a lot of technological businessprocess changes that we're going to have to make as an industry toprepare for the demographic changes," she said.

These individualized products must go beyond generationaldifferences and speak to ethnic diversity as well, according toBarry Rabkin, senior research analyst, Insurance FinancialInsights.

Mr. Rabkin pointed out that Hispanics are the fastest growingpopulation in the United States. To cater to this group, insurancecompanies have to go beyond just translating material into Spanish."That's not going to cut it," he said.

Mr. Rabkin noted that the Hispanic population consists ofsubpopulations, such as Mexicans, Puerto Ricans, etc. Insurers haveto understand the specific cultural behaviors and needs of thesesubpopulations to market to them effectively.

The ultimate objective is a greater segmentation of products,whether it is along ethnic, cultural, socio-economic, orgenerational lines, Ms. Harris-Ferrante explained. "We have to getmore granular with our products," she said.

While there tends to be a technological focus in the industry onproduct configurators that help insurers bring products to themarket with increased speed, the real issue is whether insurers areoffering the right products to their customers, Ms. Harris-Ferrantesaid.

This includes looking at what customers want today, "but moreimportantly, what are our customers 10-to-20 years in the futuregoing to want from us as an industry? And I guarantee it's notgoing to be what we're trying to sell today," said Ms.Harris-Ferrante.

This evolution in the industry should involve not just theproducts offered, but also the service, and delivery of service,according to Craig Weber, senior vice president, Celent, LLC.

He spoke of a technological industry shift toward a "globalservicing model" in which language, currency and even location willnot matter as services are delivered over the Web. While theindustry is not there yet, Mr. Weber said, it is moving in thatdirection.

"A good, long-term vision is to kind of get rid of theartificial constraints of time and place and language that arethere today," Mr. Weber said.

Beyond selling products, insurance companies will need to sellthemselves as an industry to a new generation of workers, theexperts agreed.

David West, research area director, insurance, for TowerGroupInc., said that when insurers replace their older systems with morecurrent technology, they are not only making business easier, but"it also creates an environment that is more attractive to youngergenerations coming out of college." These workers, he noted, want aworking environment that is modern and exciting.

Ms. Harris-Ferrante said that technology can also play a role inhelping to retain key older workers as well. For example, she notedthat some workers in New York will retire to Florida, but willstill be willing to work via a virtual office.

Mr. Josefowicz pointed to the need for an evolution in businessculture when recruiting young talent. "The next generation ofworkers is not going to play the apprentice game that the industryhas relied on," he said.

The industry, he explained, must evolve away from a model wherea worker cannot become a commercial lines underwriter, for example,without working as an apprentice for five to ten years. Instead,the industry should move toward a culture of sharing knowledge andallowing new workers to be productive by giving them theappropriate tools, Mr. Josefowicz said.