Small-business insurance carriers grappling with the conundrum of whether to take the plunge and sell directly to consumers over the web but fearful of undermining their existing distribution force should consider the possibility of having their cake and eating it, too.
The decision whether to bypass agents and connect with small-business insurance buyers online doesn't have to be an either/or scenario. Indeed, insurers could conceivably have it both ways, lowering the odds of potential disruption by emerging online competitors, while supporting rather than displacing their exclusive or independent agents.
This was one of the main conclusions coming out of a study by the Deloitte Center for Financial Services, "Small-business insurance in transition: Agents difficult to displace, but direct sellers challenge status quo." The report was co-authored by yours truly, along with my research team colleagues, Michelle Canaan and Nikhil Gokhale, with significant input from John Lucker, a principal with Deloitte Consulting LLP as well as our Global Advanced Analytics and Modeling Market Leader.
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