Consumers are increasingly turning to the Internet to research insurance and annuity products with many viewing it as their most valuable source of information. Still, the Internet is far from displacing insurance professionals from their roles, according to new survey from LIMRA, an industry-funded research group.
More than six in 10 consumers (61%) who researched individual insurance or annuity products looked online, up significantly from 38% who looked online in 2006. The number of people who considered the Internet their most valuable information source increased to 25% from 18% in that same time.
Despite the Internet’s growing popularity, insurance professionals still maintain the lead with more consumers (69%) seeking information from agents, brokers and advisors. And more people still consider insurance professionals to be their most valuable source of information compared to the Internet, though the gap is closing. Almost four in 10 consumers (37%) rate insurance professionals as the most valuable source, down from 45% in 2006.
While the Internet is not a substitute for personal advice, it’s a “good starting point” to gather basic information before approaching an insurance professional, Catherine Theroux, director of public relations for LIMRA, said in an interview.
The decline in the number of people who viewed insurance professionals as their most valuable resource was driven by the younger generation who rely heavily on the Internet and family connections, said Theroux.
Gen Y consumers are the biggest users of the Internet, according to the findings. They are more likely to rate online sources as their single most valuable information source, to seek online recommendations for companies, and to use agent locators relative to older consumers. They also connect more often with companies online.
The survey also found that men and higher-income, better-educated consumers look online more often than do other demographic groups. Sixty-five percent of men used the Internet for research, compared with 58% for women. Another interesting finding: consumers without children were more likely to seek information online (67%) than those with children (58%).
“Companies should understand that the Internet’s influence is likely to grow stronger over time yet the need for personal interaction with an insurance professional will always be important,” Mary Art, research director for LIMRA technology research, said in a statement. “It is critical that companies take steps to create a robust, easy-to-use site that offers the information consumers most want online and then make sure consumers can talk with an agent, advisor or someone at your company to answer questions.”
The online survey polled 2,100 U.S. consumers in the late spring of 2012. The respondents had researched or purchased at least one insurance product through any channel within the previous 24 months. They earned at least $35,000 in annual household income.