Using Web-based Technology to Sell More Insurance

INTERNET-BASED technology continues to revolutionize all aspects of insurance agency operations. In the past couple of years, it has had a significant impact on agents' No. 1 job: putting business on the books.

To get an idea of what's available to assist agents with various parts of the sales process, we recently contacted a number of vendors. They market products agents can use to obtain leads, manage them and then acquire data to supplement submissions. Following is a review of some of these online resources.

AgentInsider
(www.agentinsider.com)
This is a lead generation service launched last year by InsWeb, an online insurance shopping site for consumers that has been around for more than a decade.

InsWeb's assumption, according to Jaimie Pickles, executive vice president, was that consumers using the site would be “do-it-yourselfers,” uninterested in the services of insurance agents. Consequently, the InsWeb site offered them the ability to get instantaneous quotes from several direct writers and then buy coverage from the one providing the most attractive offer.

Research, however, has shown that consumers have not used the site that way, Pickles said. “We found that about half of the consumers who came to InsWeb ended up changing their insurance provider; that was the good news,” he said. “The bad news was that only a fraction of those consumers were switching to the carriers we partnered with.”

As it turned out, consumers were using the site primarily to gather information about insurance, including prevailing rates, Pickles said. Then they'd take it to a local agent–either a captive or an independent–and use it in negotiating a purchase.

After realizing that the vast majority of their clients ultimately wanted to buy insurance from a local agent, Ins-Web decided to provide that option, Pickles said. Now, consumers visiting the site can obtain quotes from one local independent agent and three or four local captive agents, each representing a different insurer. They also can continue to get one or two quotes from direct-writers.

Independent and captive agents bid for the quote requests via InsWeb's AgentInsider service. After registering at the AgentInsider site, agents select the ZIP code(s) from which they want leads. Three types of leads are available, and the minimum bid varies by state: Homeowners and preferred auto leads are $6 to $9 each, and special (nonstandard) auto leads are $3 to $6 each. Agents also can set a maximum number of leads they want to accept per day or month to ensure they stay within their budgets.

Like buyers on eBay, agents purchasing leads can see the current high bid for a given type of lead in a given ZIP code and top it if they wish. Pickles said in the near future, agents will have the option of setting a maximum price for a lead and then letting the system automatically increase their bids as others come in, up to the maximum price. (Independent agents bid only against other independent agents in the one “slot” allocated for them, not against the captive agents who separately compete for leads in the three or four other slots allocated for them.)

Pickles said that InsWeb decided to use a bidding system to sell leads after research indicated that agents' chief complaint with most online leads services concerned their exclusivity. After one agent bought leads of a certain type in a particular ZIP code, all other agents were “locked out.” In contrast, Pickles said, Agent Insider gives a lead to the agent willing to pay the most for it. Not that there is that much competition for leads at this point, he added. Pickles said about 2,000 agents currently are using the service, but they are spread all over the country and often can buy leads at the minimum-bid price. Only in certain ZIP codes in a few states, including Arizona, Illinois, Colorado and Washington, do any “bidding wars” seem to be going on, he said.

Agents are notified of their leads instantaneously by e-mail. Then they go to the AgentInsider site to view their leads, which contain the X-dates and everything else needed to provide a quote, Pickles said. He added that it's important for agents to respond immediately, since the consumers typically are ready to buy. At present, agents cannot download the lead data and plug it into their rating systems, Pickles said, although the vendor is in the process of building that functionality into its system.

Agents pay for leads by providing a credit card number, against which an initial $100 is charged. As agents buy leads, the cost is deducted from their deposits until they are used up. Then the service automatically replenishes the deposits via additional $100 charges against the credit cards.

About one in 10 consumers visiting InsWeb provides false contact information, Pickles said, apparently just to obtain an instantaneous quote from one of the direct-writer companies. If agents receive such leads, they can click a button and get a credit for them, Pickles said. He said InsWeb also uses certain screening questions to weed out personal-auto insurance buyers whose intent is only to “rent” insurance long enough to get license tags, then let coverage lapse.

Pickles said research indicates that about a third of consumers now start the insurance-buying process online. (Last year, four million filled out, or started to fill out, quote-request forms on InsWeb, he said.) This indicates that such traditional forms of advertising as Yellow Pages and billboards are growing less effective, he said. “Agents are beginning to learn that having a presence on the Internet is of critical importance, if they want to grow.”

NetQuote
(www.netquote.com)
This is a lead generation service that has been around since the late 1980s, according to President Scott Striegel. At first, it operated as a Denver-based regional vendor, selling agents leads gathered by various means, including radio, TV and Yellow Pages advertising. “When the Internet came along, it opened up a tremendous opportunity for us to go nationwide,” Striegel said. In September, Net Quote was acquired by two private equity firms, giving it the means to continue expanding operations.

NetQuote uses online advertising, partnerships with major portals, “paid” search, and relationships with numerous affiliates to drive consumers to its site. There they can request quotes for personal-auto (preferred, standard and nonstandard), homeowners, life and health insurance, as well as for some business-insurance products, including group health. Striegel said the vendor also solicits consumers by e-mail but requires them to “opt-in” twice, which helps ensure they reach people really interested in getting NetQuote's e-mail solicitation. Consumers who decide to visit the site (whether persuaded by the e-mail solicitation or other marketing efforts) are required to complete comprehensive applications to obtain quotes, Striegel said. While that probably reduces the number of leads the site receives, he said, it ensures the capture of all information agents need to offer accurate quotes.

Agents can purchase leads from desired ZIP codes and for specific product lines. “We'll give an agent a free trial to make sure they're comfortable with the type of leads we're sending them,” he said.

NetQuote e-mails leads to agents (or faxes them, occasionally), and increasingly sends the lead information directly into agents' rating engines. “A large part of their success is based on the speed of their response to the consumer,” Striegel said. Obviously, insurance agents can provide quotes faster if they don't have to first enter prospect information into a rating program, he said. Currently the vendor integrates with five rating engines, Striegel said, and is negotiating with several other rating-system vendors. “It's an initiative we've had under way for about a year-and-a-half, and it has really picked up momentum,” he said.

Agents pay from $1 to $15 per lead, depending on product line. Striegel said NetQuote has no cap on the number of agents to which it sells leads but generally limits distribution of each lead to no more than five quoting organizations, including independent agents, captive agents and direct-writer insurers.

We Speak Insurance/Hablamos Seguros
(www.wespeakinsurance.com/
www.hablamosseguros.com)
This is a lead-generation service geared to the rapidly growing Hispanic market. David Stafford, an Arizona insurance agent, started it in 2004 to gather leads for his own agency. After his site began drawing leads from all over the country, he decided to start selling them to other agents as well.

Stafford draws traffic to his site by running banner ads on various Spanish language sites and pay-per-click online advertising. Currently, the site draws about 2,000 leads a month, he said.

Initially, the site required consumers to fill out quote applications in Spanish. After noticing that many visitors started but did not complete the process, Stafford did a little research. As it turned out, many visitors wanted to complete the applications in English, because that was the language in which their current policies were written, and they referred to them when filling in the online forms.

That discovery led Stafford to make the site bilingual. Two prominently displayed buttons enable visitors to toggle back and forth between Spanish and English at any time. They can read information at the site in either language and also switch between them as they complete applications. For example, they can respond to form questions in Spanish, then hit the English button to see if the translations match what they see on their existing English-language policies. Stafford noted that since Hispanic consumers' proficiency with English varies widely, a bilingual site is ideal for serving them.

The site permits visitors to seek quotes for either personal-lines auto or homeowners insurance. Each lead is sold to up to five agents, two of which could be independent. Before forwarding leads to agents, the site e-mails confirmation messages to the consumers who have provided them. If a message is undeliverable–because a false e-mail address has been provided, for instance–the corresponding lead is kicked out of the system and not sent to agents.

To receive leads, an agency must have at least one Spanish-speaking licensed employee on staff during business hours. That is important not only for explaining insurance concepts in Spanish when necessary, but also for establishing rapport, Stafford said. Even Hispanics proficient in English often prefer to speak Spanish when chatting about their families or otherwise making small talk, he noted. “It just makes them feel welcome.”

Agents pay $7 for each homeowners lead and $5 for each personal-auto lead. Leads can be viewed in either English or Spanish. The information does not always include applicants' Social Security numbers or driver's license numbers. Stafford said site visitors are sometimes hesitant to divulge such personal information until they actually get a chance to speak with a person, so providing it on the forms is optional.

Precisionleads.com
(www.precisionleads.com)
This site, owned by ChoicePoint Precision Marketing, sells prospecting lists. The leads are compiled from the vendor's proprietary data as well as from a variety of other leading pro-viders of data for direct marketing, said Bunny Randall, vice president of direct-marketing fulfillment services; they do not include people who have just asked for quotes at a Web site, as is the case with other services profiled in this report. Precisionleads.com also offers turnkey direct-mail services, Randall said.

Five kinds of property-casualty personal-lines prospecting lists are available. Lists for auto and homeowners prospects include projected renewal dates. Separate lists identify people who have obtained a new mortgage within the past four months, people who recently have moved to an agent's or broker's area, and renters. A sixth prospecting list is available for small businesses (99 or fewer employees).

Leads can be purchased for pros-pects in selected ZIP codes, within a specific radius of a selected ZIP code, for a state or nationwide. Basic information consists of name and address. Phone numbers (screened for compliance with national “Do Not Call” and “Do Not Solicit” requirements), ages, incomes and other demographic data can be provided as well, Randall said. Lists generally are available to buyers online within minutes.

Agents and brokers also can arrange for direct-mail programs via the site. The service prints materials, conducts the mailing and processes responses. It has standard mailers for use with the auto, homeowners and “new-neighbors” prospect lists. The service also can accommodate requests for customized materials with logos, client-created copy, etc. A “Knowledge Center” posts articles and other information about lead management and marketing campaigns.

Net-Lead
(www.net-lead.net)
This company was started about three years ago by a group of agents, both independent and captive, in Plano, Texas. About 18 months ago, it started marketing Agency IQ, an online prospect management system.

According to Teresa Kitchens, who is Net-Lead's sales manager and also the owner of Sterling Insurance Group in Plano, the agents found it difficult to keep track of leads with the resources they had. “When someone called in, we weren't able to market to them down the line,” she said. “(The information) was pretty much lost, unless you wrote the business, and that was a point of huge frustration for all of us.” Consequently, the group hired their own programmers to create an insurance-specific version of popular customer relationship management systems like Act! or GoldMine.

Kitchens said agents can submit leads to the program in almost any electronic format, including Excel spreadsheets and CSV (comma-separated values) files. Agency IQ then automatically puts all the information into appropriate fields in the CRM files, she said. Net-Lead also has an agreement with NetQuote that allows leads purchased from that vendor to be automatically loaded into Agency IQ.

After lead information is entered into the CRM system, it automatically e-mails a customizable message to prospects, thanking them for their interest and providing contact information, Kitchens said. After that, agents manage the information as they wish. They can send and receive e-mail messages out of the system and attach any type of files, including PDFs and JPEGs, to them. The message is identified as coming from the agent's own server, rather than Net-Lead's.

The CRM system keeps a chronological log of all contacts with prospects, Kitchens said, and can be used to set reminders. It also can be used to run marketing campaigns, using prospect files sorted by X-date or other criteria, she added.

Agency IQ is compatible with some online rating products and Net-Lead is working to make it compatible with others, Kitchens, said. It also plans an upgrade this year that would enable Agency IQ to pre-fill commercial-lines ACORD forms for use in submission preparation, she said.
Net-Lead maintains backups for its servers in four states to enhance reliability, Kitchens said. It also employs a security team and uses appropriate firewalls, she said.

Agents using Agency IQ pay a $500 deposit, Kitchens said, then a monthly per-user fee that averages about $40 for small agencies and decreases to about $20 as the number of users rises. (Prices are subject to change.) Agents own the data maintained in the system, she said, and have it returned to them in an Excel spreadsheet if they stop using the service.

Insurance Information Exchange (iiX)
(www.iix.com)
Agents not only can obtain and manage leads online these days; they also can use the Internet to access information to underwrite them. This is where organizations like iiX come in. For more than 20 years, iiX has provided a variety of underwriting services to agents, brokers, carriers and employers. Since 2002, it has been owned by the Insurance Services Office. According to Stefanie Haggerty, sales and marketing manager, it has some 9,000 agent and broker clients.

Agents and brokers most often use iiX's nationwide motor vehicle report service, Haggerty said. Most obtain the MVRs via iiX's ExpressNet online service, she added. Clients are given account numbers and passwords to order, view and print MVRs at the vendor's secured site. MVRs for most states are available instantaneously. State charges for MVRs vary from $1.25 to $18 each, Haggerty said, to which iiX adds a service fee.

For customers who not only desire the current MVRs but also want to monitor drivers, iiX offers DriverAdvisor. This service, available in certain states, notifies users whenever new activity is reported on a person's MVR. Haggerty said the service mostly appeals to insurers, who use it in the renewal process. Some larger agents and brokers use it as well, she said.

There are several other underwriting services that agents and brokers can access at iiX through what it calls its “Point of Sale” program. But to do so, agents must be sponsored by one or more insurers, Haggerty said. Also, they can access the information only for anticipated business with the sponsoring carriers, she added. One such product is the A-PLUS claims history database, maintained by ISO's American Insurance Services Group unit. The database contains information on property and liability claims, for both commercial and personal lines, submitted by insurers representing a large majority of the marketplace. Another product identifies undisclosed drivers in a household, as well as vehicle identification numbers associated with a particular address. Carrier-sponsored agents and brokers also can access TransUnion credit scores via iiX. In working with these and other services, agents and brokers can use an online chat option that enables iiX employees to answer questions and provide other information within seconds.

ChoicePoint
(www.choicepoint.com)
This information-services provider operates a Web-based service called ChoicePointLink, which authorized agents can use to access risk assessment information for use in personal-lines insurance policy rating and issuance. To access the service, an insurance agent must first be sponsored by a licensed insurance company, said Bill Agee, assistant vice president, and undergo credentialing to verify that the agency is valid and has been licensed by the relevant state insurance department. Typically, individual agents are sponsored by multiple insurance companies, he said, and can access information for business conducted on behalf of those carriers. Currently, the service is used by more than 50,000 agents, Agee said.

Agents can use the online service to view and print motor vehicle reports as well as reports identifying additional drivers in a household. They also can access reports from the Comprehensive Loss Underwriting Exchange (C.L.U.E.), a claims database insurers use for underwriting and rating. Sponsored agents also can obtain credit information that identifies a “tier” into which a prospect falls. Actual credit scores and the report data supporting them are not disclosed to agents, however, Agee said.

ChoicePointLink also provides direct access to PriorityRate.com. This rating product, developed and maintained by another ChoicePoint company, integrates credit scores, motor vehicle record data and C.L.U.E. data from participating companies directly into the rating process. It also provides dual sets of rates, automatic symbol territory and protection class look-up, and automatic tiering, based on company-specific criteria, Agee said. It also provides access to real-time rates from participating carriers, he said, which are displayed in a comparative environment.