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Consumers not so predictable in insurance ‘switching’ survey

Thu Mar 6th, 2014 on     Homeowners Insurance,    

The insurance industry group at Accenture PLC released the results of a survey recently that must have made a few agents and brokers shudder. The results, in fact, may explain in part why the industry is so anxious for Congress to pass the National Association of Registered Agents and Brokers Reform Act (see our Feb. 4 post): If they cannot sell across borders, agents and brokers will have a tough time competing with, oh, Amazon and Google.

Accenture polled home and auto policyholders in 11 countries about their decision-making process when buying insurance coverage. The researchers found that 67 percent of the respondents would consider buying home and auto coverage from an organization that is not an insurance company. Many — 23 percent, so not a majority — even consider purchasing coverage from online service providers.

Cue the mega-stores. Consumers could see “Insurance” tucked between “Industrial & Scientific” and “Jewelry” on Amazon’s pull-down search menu.

Perhaps less alarming was the finding that “switching risk” is fairly high for home and auto insurers this year. Accenture estimates that $400 billion in property/casualty and life insurance premiums could shift from one company to another. The study did not show how many of those changes were voluntary, though — a fairly sore subject here in Florida, as state-backed Citizens Property Insurance Corp. continues to “depopulate.”

The vast majority of respondents (85 percent) said that a lower price was important or very important to in their decision to change carriers. Eighty percent — respondents were allowed to choose multiple answers — said the same about personalized service. When asked to weigh the two against each other, just 41 percent said they would pay more for coverage if personalized advice were included in the deal.

These are considerations for consumers, but are they drivers of change? We’ll talk about that in our next post.

Source: Carrier Management, “Nearly One-Quarter of Insurance Consumers Would Buy Cover from Amazon, Google: Accenture,” Feb. 6, 2014

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