Google’s entry into insurance lead generation and aggregation worried agents and carriers. Would Google disrupt the industry as they have so many other industries? Would they short circuit research-driven consumers by dominating the top results? The Google Compare concern was legitimate.
Then a year ago, Google abruptly announced they would be exiting the market. The industry sighed a collective relief amidst high fives and a symphony of “I-told-you-so.”
Articles about their exit detailed two main points: Why Google decided to pack it in, and, why the industry should take notice of the real changes in consumer research and purchasing habits.
Why did Google decide to enter the market?
Over the past few years, consumers’ habits have changed. According to the last five comScore reports, more shoppers are researching insurance online, and, more people are requesting information or actually buying online.
Google attempted to capitalize on this change. But before and after their exit, there were other players noticing the same trend. And, guess what? They are still around.
What has happened since?
On the surface it looks like little has changed in the year since Google Compare’s exit, but dig a little deeper and see the flurry of changes in and around the industry.
Most notable is the billions of dollars coming into the industry to chase connected consumers. This includes a $192 million investment in MetroMile by investor Mark Cuban (coincidentally Cuban also invested $17 million in The Zebra in 2016); a $34 million B round of funding for Lemonade; Hippo’s raising $14 million; and ACE’s $33 million investment in Coverhound.
The majority of the investments occurred in 2016, and are just a few of the many investments in our industry. These investments are driving new startup firms into homeowners, personal auto, commercial and cyber liability.
How are carriers reacting?
Lead generators and aggregators are changing the normal flow of new business through the redirection of consumers away from traditional agents. And, they are starting to offer insurance coverage through new and unique ways – pay-as-you-go insurance, or, instant claim service using artificial intelligence driven chat bots.
Carriers have taken notice and are monitoring the changing landscape. They are beefing up their investment in technology and opening direct call centers; they are even revamping their products to match what today’s insureds want.
Are agents adapting?
In the past few years, many agents have buried their heads in the sand. For many it continues to be business as usual, or, they’re shifting their primary offering from personal lines to commercial.
Others have recognized they need to fundamentally change and are open to the changing landscape.
They are transforming their agencies into a sales-based culture. They use technology, such as comparative rating and automated agency marketing systems, to simplify doing business with them. They are providing the quick, versatile buying and service experience consumers are demanding.
More than that, these agents are providing more value. They are updating their processes away from policy management and focusing on nurturing the complete client relationship.
What does the future hold?
Investment in insurance and its subsequent technology is showing no signs of slowing.
Will we see players leave the market as Google did? Sure. Will we see other succeed? Absolutely.
Finally, we must not mistake the real driver of this new way of thinking – the modern insurance buyer, who are asking for and using these new ways to research and purchase insurance. You have to be ready to answer.
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