High-risk shoppers maybe one of the best segments for insurance agencies and carriers to target with online and mobile quoting and services.
New data from online agency CoverHound shows high-risk shoppers are 93 percent more likely to conduct research for insurance on their mobile devices as compared to lower risk shoppers.
“The main thing to remember about online insurance shoppers is that they come in all shapes and sizes,” said Rory Joyce, CoverHound’s chief product officer and co-founder.
When it comes to variety, Joyce isn’t just talking demographics. According to him, an assessment of the users who came to CoverHound.com shows they visited on 2,200 different devices.
The disparity between how high-risk versus low-risk shoppers’ online insurance researching and buying profiles is worth noting:
- Compared to higher risk shoppers, lower risk shoppers are 49 percent less likely to complete an insurance purchase on a desktop;
- Compared to higher risk shoppers, lower risk shoppers are 43 percent less likely to complete an insurance purchase on mobile;
- The above differences in lower risk shoppers’ digital insurance shopping behaviors – both desktop and mobile – could be due to more complex insurance needs;
- Higher risk shoppers are 7 percent more likely to purchase their insurance within the first week compared to lower risk shoppers;
High-risk shoppers tend to go online for a number of reasons, and they tend to be more comfortable not only self-servicing during the quote process, but also purchasing online, Joyce said.
This is because high-risk shoppers are typically younger, and younger segments are inherently more active on the web, according to Joyce.
“There is less demand, from a carrier standpoint, to write high-risk policies,” he added.
Going online allows the segment to maximize their options.”
While the low-risk segment maybe be a little bit less comfortable actually purchasing insurance online, they are comfortable getting that initial comparison online without talking to an agent, according to Joyce.
Another notable difference is the high-risk segment seems more willing to use mobile devices for a majority of their needs.
“It could be more younger folks tend to be what we consider high-risk and the lower-income folks,” he said. “In many cases, a mobile device can be their only connection to the web.”
CoverHound data also shows that high-risk shoppers are more likely to make an immediate purchase decision.
What accounts for that?
“I don’t think it’s any one thing – it’s pretty interesting,” Joyce said. “A couple of factors: high-risk shoppers, for example, they tend to be more likely to be without insurance, so that creates a greater sense of urgency.”
It may also be impulse. Younger people are more likely to want to get a purchase made sooner than later, and these high-risk shoppers typically have fewer overall options in the market, so when they see a deal they’re compelled to jump on it, he said.
The message in all of this may not be totally new, but the take-home is that offering a good online experience is important.
“You really need to have a dynamic experience that really takes the specific segment’s behaviors and preferences in account and build your experience accordingly,” Joyce said.
Joyce also offers a reassuring message to agents who feel online insurance purchasing is leaving them out in the rain: The majority of the market may be comfortable getting an initial quote online, but they still want to pick up the phone and close the deal with an agent.
“Obviously there are going to be segments, who tend to be the younger generation, where they’re just conditioned to absolutely not want to talk to anyone over the phone,” he said. “We find that when given the option to not talk to an agent versus purchase online, most of that segment is going to do so.”
However, the majority of the market still is only comfortable in getting that initial quote online or through an app. They still want interaction with an agent, and they prefer close the deal with an agent, Joyce said.
He added: “I think the best lesson here is: the need for agents isn’t going away overnight. And then make sure that we’re always giving the best service possible across the board, high-risk, low-risk, middle market.”
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