Personal-lines insurers are locked in a never-ending battle formarket share—which has only intensified over the past few years asauto and homeowner's carriers struggled for organic growth during adown economy and depressed housing market.

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However, while the prospects for exposure growth are lookingbrighter with unemployment declining, auto sales beginning torebound and some signs of recovery in the housing sector, insurersface more fundamental challenges beyond the ups and downs of themacro-economy.

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Indeed, most carriers arereassessing their marketing, sales and service systems to adapt tothe fast-paced evolution in consumer behavior and preferences,driven primarily by advances in Web and mobiletechnologies. 

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More people are living their lives in the virtual world—whetherthrough their laptop, tablet or smartphone—and they expect theirinsurers to be there with them. These consumers are surfing the Webover multiple devices to learn about products and services,price-shop and exchange customer experiences over social media—andto buy policies and file claims online.

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Yet there is a sizable group of consumers who still prefer thehuman touch in personal lines, choosing to establish a trustedrelationship with an insurance professional who can help them shopfor a policy (often for more than one type of coverage) as well asshow them how to navigate the claims process and be their advocatein case of a dispute over a loss.

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As a result, fewer companies are dedicated to distributingthrough any one channel. Many are looking to reach prospects andmore regularly communicate with policyholders over multipleplatforms, both to take business away from competitors and toimprove retention of their own customers.

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The challenge is to determine what makes personal-linesinsurance buyers tick in this new environment. What motivates themto choose and remain with a particular carrier and channel—whetherthey buy through an independent or exclusive agent, or skip anintermediary entirely to deal directly with an insurer? Moreimportantly, what might prompt a personal-lines consumer to switchcarriers and perhaps channels as well?

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These were some of the key questions explored by DeloitteResearch in an online survey of 1,080 auto policyholders and anequal number of those with homeowner's coverage. Among the criticaltakeaways from the surveys:

  • While the vast majority of respondents appear to be satisfiedwith the price charged and service provided by their currentcarriers and agents (if they use one), there are demographicfactors at work that make some prospects more viable than others interms of taking them away from the competition.
  • The same can be said when it comes to channels—while somerespondents are committed to buying with an intermediary and otherswithout, there is a significant percentage of “independents” whoare more open to switching from agents to a direct purchase (orvice versa), given the right circumstances and enticements.
  • Age was by far the most significant differentiator among thevarious demographic factors examined in these surveys, whether interms of the openness of younger consumers to changing carriers andchannels, their willingness to do business without an intermediaryor their interest in high-tech options for sales and service.
  • Technology, particularly mobile options, is likely to play anincreasingly important role in the marketing, sale, servicing andretention of insurance customers—especially those coming into themarket as new drivers and homeowners.
  • Trust is a big issue when doing business with insurers andtheir agents—and it's an attribute in short supply in the view ofmany respondents. Establishing brand recognition, maintaining apositive reputation and strong ratings, and overcoming suspicionsabout the integrity of insurers and agents can make a bigdifference in drawing prospects away from rival carriers andchannels.
  • Price remains the biggest single element respondents considerwhen purchasing personal-lines insurance. However, the surveyresults also indicate that price is far from the sole decisionpoint when a prospect is determining whether to become (or remain)a policyholder. The surveys identify a number of other factorsinsurers might leverage to convince a prospect to switch companiesand/or channels.

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