U.S. Auto and Home Insurance Customers Turn to Digital Sources to Obtain Information and Quotes, but Prefer Using Agents to Buy Products
U.S. consumers are turning to digital sources for insurance quotes and
other information, but still prefer personal contact with agents when
purchasing insurance products, according to an Accenture survey of more
than 4,000 U.S. automobile and home insurance customers.
Major findings include:
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Nearly three-quarters (76 percent) of consumers express a preference
for setting up and paying for their auto and home insurance policies
in person with an agent, and more than half (58 percent) indicate a
preference for doing so via the Web.
-
When asked where they prefer to obtain quotes, 43 percent of
respondents choose websites, while 26 percent choose over the phone
and 26 percent in person. A much smaller percentage (four percent)
chooses mobile applications.
-
Almost three-quarters (72 percent) of respondents also express a
preference for getting information about products and prices from an
insurer’s website. Exclusive insurance agents rank third with 56
percent of respondents, behind friends and family, cited by 61 percent
of respondents. Search engines and aggregators rank fourth and fifth
at 55 and 54 percent with respondents, respectively.
“In defining their distribution strategies, insurers must recognize that
consumers are becoming more diversified in their channel preferences at
different stages of the buying process,” said Erik J. Sandquist, a
managing director in Accenture
Property and Casualty Insurance Services. “Direct insurers continue
to gain share as consumers grow increasingly comfortable buying policies
online. This means that insurers with an agency distribution model must
adapt to customers’ changing preferences and integrate their agent
networks with digital, mobile, and social media capabilities.”
Age is not a consistent predictor of channel preference
Also according to the survey:
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Only 37 percent of respondents aged 18 to 24 say they prefer to obtain
a quote via a website, compared to 53 percent aged 25 to 44 and 41
percent aged 45 to 64. However, 10 percent of the respondents aged 18
to 24 say they prefer to obtain a quote via mobile applications,
compared to five percent aged 25 to 44 and one percent aged 45 to 64.
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Nearly one-third (32 percent) of respondents aged 18 to 24 say they
prefer to obtain a quote in person; only the oldest respondents (aged
65 to 74) are more likely to prefer obtaining a quote in person (39
percent).
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More than two-thirds (68 percent) of respondents aged 18 to 24 say
they would be willing to pay more for personalized advice when
purchasing auto or home insurance policy, compared to 27 percent of
those aged 45 to 64 and just 16 percent of those aged 65 to 74.
“Much has been written about young consumers – with their strong
propensity for Internet, social media and mobile – fundamentally
changing insurance distribution,” said Sandquist. “Our survey reveals
that many young consumers desire personalized advice and are willing to
pay more for it – and a significant percentage prefers to obtain their
quotes face-to-face. There are many demographic, psychographic,
lifestyle and other factors which can account for differences in how
customers would like to be treated. Some customers make decisions almost
exclusively on price while others seek the best advice available, and
this is not consistent by age groups. More sophisticated digital
marketing, customer segmentation and analytics are needed to attract
customers and deliver more personalized and relevant products and
experiences.”
Insurers have opportunity to build customer loyalty and establish
differentiation
Among the survey’s other findings:
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One-quarter (26 percent) of respondents either do not plan to renew
their auto or home insurance policy with their current insurers or
plan to look at other insurers’ offerings.
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Nearly half (46 percent) of insurance customers think that the
products and services offered by different insurers are essentially
“all the same”.
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More than one-third (38 percent) of consumers are willing to pay for
personalized advice about the insurance that is best for them – and,
of that group, more than half (56 percent) are willing to pay at least
10 percent more.
“Our survey research reveals a significant opportunity for insurers to
grow market share as many customers plan to shop around when renewing
their policies. Price remains the most important buying factor which
will continue to put pressure on insurers to improve their cost
structures. At the same time, our research reveals that a carrier’s
distribution model can be a strong differentiator, given the relative
importance of factors such as interaction channel, advice and speed,”
said Sandquist.
Methodology
Accenture conducted a quantitative online consumer survey of 4,067
individuals in the United States, with 2031 answering the questionnaire
regarding auto insurance and 2036 answering regarding home insurance.
Samples were representative of gender, age, and income as well as
regions. Interviews were conducted in August, 2012.
About Accenture
Accenture is a global management consulting, technology services and
outsourcing company, with approximately 261,000 people serving clients
in more than 120 countries. Combining unparalleled experience,
comprehensive capabilities across all industries and business functions,
and extensive research on the world’s most successful companies,
Accenture collaborates with clients to help them become high-performance
businesses and governments. The company generated net revenues of
US$27.9 billion for the fiscal year ended Aug. 31, 2012. Its home page
is www.accenture.com.
Accenture
Property and Casualty Insurance Services is a business service
within Accenture’s Financial Services operating group that provides
management consulting, technology and outsourcing services to property
and casualty insurers. Its services are designed to help insurers
achieve profitable growth though product innovation, enhanced customer
interactions and reduced operating costs.