Digital Does Matter in Insurance-- And Insurers are Missing the Mark
Bill Sinn | October 04, 2019
Amazon. Google. Apple. Three companies that have raised the bar on customer engagement, defined “great” customer service and dramatically transformed the entire customer experience landscape--all by putting the customer at the center of the equation.
No industry has been immune from the pain or fortune--but mostly pain--of digital disruption, including insurance. It has even created an inviting environment for companies like Amazon to investigate and analyze opportunities to enter the lucrative insurance marketplace.
So how are insurers performing in the this relatively new digital world?
According to the second annual “Gartner L2 Digital IQ index: Insurance U.S. Report,” released in July of this year, the results were, to put it mildly, underwhelming. The report, which ranks the digital performance of 54 brands operating in the auto, life and/or property & casualty sectors of the U.S. market, measured 1,200 data points against four critical dimensions: digital marketing, social media, desktop site, and mobile site. From these calculations, two brands were classified as Genius, 17 as Gifted, 11 as Average, 14 as Challenged, and 10 as Feeble.
Here is what the categories mean:
Genius: companies whose digital competence is a point of competitive differentiation
Gifted: companies that are experimenting and innovating across their website, mobile and social platforms
Average: companies whose digital presence is functional, yet predictable
Challenged: companies that have limited or inconsistent adoption of mobile and social media platforms
Feeble: companies where their investment does not match the opportunity.
In Gartner’s survey, the majority of brands landed in Gifted (31%) or Challenged (26%) categories. State Farm maintained its Genius classification year over year, while GEICO swapped positions in 2019 with last year’s other two 2018 Geniuses, Allstate and Liberty Mutual. Fourteen out of 17 of the net new brands in the 2019 study were either Feeble or Challenged. Amica was the only case in the cohort of new brands to earn the Gifted classification.
The good news? All of the participating brands offered some level of service across many aspects of the digital spectrum.
The bad news? Despite these efforts--and the prospects’ willingness to provide data and information--insurance providers are still hard-pressed to bridge the digital divide.
According to the Gartner study, people looking to purchase life insurance online have doubled in the last six years. Yet only 38% of these brands allowed users to enroll online after filling out a “Request-a-Quote” form, and 28% did not even offer next steps. Additionally, nearly half of all site traffic is driven to the homepage, but only 46% of brands have a call-to-action in their primary navigation. A disconnect that can dampen prospect activity and leave customers wanting more.
“U.S. insurance brands reached the mobile tipping point in 2019,” says Elizabeth Elder, principal, financial services at Gartner, with an average with an average of 52% of total traffic to brand sites taking place on mobile devices. “However, the numerous drop-offs in mobile site features showed that insurance brands have not adjusted well to the new landscape.”
According to Elder, basic features such as site-specific login, editorial content and keyword search were found on desktop sites, but not mobile sites. Some brands failed to port certain customer service elements, such as their “Contact Us” page, to their mobile sites. Mobile promotion was the only basic feature to see higher adoption on mobile sites than desktop sites.
“To thrive in this new landscape, insurance brands must create a seamless transition from desktop to mobile and ensure all crucial elements on the desktop site translate to smaller devices,” adds Elder.
The study centered on three key questions:
How has the digital marketing landscape evolved, and which channels are insurance brands prioritizing?
How are brands leveraging content to differentiate themselves on various digital platforms?
What does digital success look like across different dimensions and what are replicable tactics?
Some of the key findings were enlightening:
The declining quality of brand sites
Gartner observed a 6% decrease in the average brand site score (compared to last year’s insurance study). It attributed this decline to the lack of basic features on many brand sites. It also demonstrated a marked disconnect between customer expectations and what brands provide. “As insurance brands increase their investment in digital,” says Elder, “it is vital they do not ignore the branded-site experience, as these sites facilitate conversion opportunities, customer utility and promotional cross-selling.”
The rise of text ads
In the 2018 study, text ads represented only 21% of nonbranded search results (i.e., “best life insurance”). This figure nearly tripled to 61% this year. Gartner found that more text ads surfaced at the bottom (32%) of a result page than the top (29%), which highlights a competitive environment dominated by spending, rather than strategy.
Mobile site falloff
Insurance brands reached the mobile tipping point: 52% average of total Index traffic to brand sites was on mobile devices during the study period. However, as indicated by the numerous drop-offs in mobile site features, insurance brands did not adjust to the new landscape. Basic features like site specific login (89%), editorial content (81%) and keyword search (74%) were on desktop sites, but not mobile sites.
The Top Digital Players
Only two insurers out of the 54 participating companies in the study earned Genius status: State Farm and GEICO. What made them different from the rest of the pack?
From a digital marketing perspective, State Farm was the only brand to have greater than 30% organic visibility in three different nonbranded keyword categories: renter insurance (63%), car insurance (36%) and life insurance (31%). The company also operated two brand-building Twitter accounts, @Statefarm and @JakeStateFarm, earning the second most Twitter interactions in the Index.
GEICO was the second most prolific display advertiser on both desktop and mobile; representing 30% of all static and video ad impressions in the Index. The company also earned the third most Facebook interactions in the Index through a heavy promotion strategy (promoting 73% of its posts). GEICO also had a robust iOS App Store optimization with 89% of their nearly 1.4M ratings across their three apps were 5 stars.
While these two companies were touted as the digital leaders, there were other notable mentions:
Liberty Mutual was a best-in-class example of a brand with extensive agent profiles. The brand’s agent tool is wrapped into the same infrastructure as a branch locator. Once a user chooses a branch, they are prompted to view the agents in that location. Each agent profile has contact information, a bio, a list of accolades and the ability to connect on social media.
AIG had unparalleled levels of Facebook performance. The brand amassed more than four million interactions during the study period, whereas Nationwide Mutual Insurance Company (the No. 2 brand in terms of interactions) only garnered 650,000, a differential of over six times. AIG posted about six times per week, just two more posts per week than the Index average, with only 43% of its posts being promoted. Nationwide, on the other hand, posted nearly 12 times per week--the second most of all brands.
So, what were some of the key recommendations coming from the study results?
“First, be sure you incentivize a prospect on your desktop site. Most brands have their non-gated assets geared toward clients versus prospects,” says Elder. “This is a lost opportunity.
“Second, search and display advertising are highly competitive markets. Understand your niche before launching expensive awareness campaigns. And third, create a seamless transition from desktop to mobile, and ensure none of your crucial elements fail to translate to smaller devices.
“In the digital ecosystem, separating the winners from the losers is not based on which digital elements an insurer merely possesses, but how they translate their efforts into holistic experiences across multiple customer journeys. That’s the key to digital success,” adds Elder.
- Take a Business-Driven Approach to Continuous Improvement for Core Systems and Processes
- Electronic Chat with Ron Glozman
- Guidewire’s Data Guru Mike Byam on How Insurers are Using Internal and Third-Party Data
- Electronic Chat with Russ Bostick
- Electronic Chat with Rock Schindler
- Electronic Chat with John Siegman
- Electronic Chat with Martin Burlingame
- Insurtech Landscape 2019: Top 5 Takeaways
- Grinnell Mutual Tackles Massive Transformation -- in Stride
- A Candid Conversation with Paul Mang
- SageSure Insurance Managers Improved Competitiveness by Consolidating Payments to a Single Digital Platform
- Digital Does Matter in Insurance-- And Insurers are Missing the Mark
- The 22nd-Century Insurer: Taking a Cloud-First IT Approach
- The September/October 2019 issue of ITA PRO magazine is now available in digital format here:
- ITA Pro Magazine May/June 2019
- Spotlight on the 2019 IASA Conference
- ValueMomentum Selects Erie as Site of Regional Development Center
- Capgemini and Majesco Become Alliance Partners
- Electronic Chat with Dr. Dan Shoham
- Electronic Chat with Todd Greenbaum
- Martha Notaras: The “Outsider” with an Amazing Inside View
- Electronic Chat with Larissa Tosch
- Martha Notaras Will Join ITA LIVE 2019 as a Keynote Speaker
- Five Things to Consider When Evaluating Your Cyber Risk
- ITA Pro Magazine, January/February 2019
- Synergy Between Insurers' IT and Analytics Teams Key to Operationalizing Insights, Says Novarica
- Major Ransomware Attack Could Hit U.S. with $89B In Economic Damages
- ITA Announces 1st of Three Keynote Speakers at ITA LIVE 2019
- Electronic Chat with Jeroen Morrenhof
- Legacy Systems Are Dead. Really? Don't Count On It.
- Now Accepting Nominations for the 2019 ITA Bridge Awards
- It's time to register for ITA LIVE!
- Registration is Now Open for ITA LIVE 2019!
- What to Expect from a Digital Experience Platform Implementation
- ITA Pro Magazine September Edition is Now Available
- It's National IT Professionals Day
- Save the Date for ITA-LIVE 2019
- OneShield Software and UrbanStat Work Together to Improve Real-Time Analytics and Risk Decision-Making
- ITA LIVE 2019 - SAVE THE DATE!
- Insurance Technology Association Announces New Editor-in-Chief
- August 2018 Edition ITA Pro Magazine is Now Available
- Enterprise Architecture in an Agile World
- Top 10 Tips for Securing Your Mobile Devices and Sensitive Client Data
- Industry Insight: 4 Global Insurance Trends in Digital, Data, Content Services and Security
- Diving Deeper into Prioritizing Your Strategic Digital investments
- Why Content Rules
- How Mass Personalization Will Open the Small Business Benefits Market
- At Year End 2017, Will Your Organization Be Protected from Cyber Risks?
- Do Insurance Bots Dream of Mitigating Risk?
- Conditioned to Respond
- Managing & Mobilizing Insurance Data in a Connected World
- Race to the Finish Line
- New Tools, New Opportunities in Claims
- ITA LIVE: Reaching Insurance Industry Crossroads
- Advice to Insurance IT Leaders: Keep Your Eye on the Ball
- New Date, Venue for ITA LIVE 2017
- Guidewire Makes Major Push to Small and Midtier Market by Acquiring ISCS
- Insurance Disruption is Happening Right Now
- Insurity Adds Strategic Investment Partner, General Atlantic
- Beyond Transformation: The Convergence of Finance, Risk, and Actuarial Functions
- The Rapid Evolution of Consumer Protection Regulation
- Talent Hunt: Finding, Attracting, Retaining Top People
- Insurers Flexing Their Distribution Models
- Technology Driving Disruption in Insurance
- Fear of ‘Next Bubble’ Challenges Life, Annuity Carriers
- Technology Allows Commercial Lines Insurers to Stand Out
- Single Sign-on Viewed as Biggest Tech Challenge for Agencies
- ISCS Observes 20th Anniversary; Scurto Predicts Major Changes Ahead
- Policyholders and Their First Impressions
- Progressive Making Progress on the UBI Front
- High and Dry: Insurers Search for Disaster Recovery Plans
- Insurers Sign The (Un)Dotted Line
- Reflections of a Retired Insurance CIO
- Mobile Device Management Just One Answer to BYOD Issue
- Lessons from GEICO and Progressive on Winning the Critical Buying Stage
- You Are a Target for a Cyber Attack
- Web-based Systems are the Next Evolution in Claims Technology
- Gaining a “Wow” Experience from Web Users
- Time to Shift from Business/IT Alignment to Business/IT Alliance
- Healthcare Insurers Changing to Consumer Model
- Organization is the Key for Selecting Software Vendors
- Analysts Expound on the Needs of the Mid-tier Insurance Market
- Finding the Cure for Obamacare’s Website
- New Software Solutions Benefit Insurers on the Inside and Outside
- Products, Market Impede Investment in Systems for Life Insurers
- Combatting Cyber Threats: Predict, Prevent, Persist
- The Future of Telematics Heads Beyond Insurance
- The Shame in Cyber Security Lapses
- Building Policy Administration Systems for the Future
- Insurers Look Into The Eyes of Their Policyholders
- It’s a New Dawn for the ITA
INSURANCE IT NEWS
- SDRefinery Rebrands to Reflect Evolving Business Model and Announces New Appointments
- Zywave Acquires Data Analytics Provider miEdge
- Trov Launches White-Label Renters Insurance Application in Partnership with Lloyds Banking Group
- Bestow Announces Executive Hires
- OCTO Acquires Nebula Systems, Reinforcing Leadership in Intelligent Vehicle Diagnostics
- Eastern Alliance Insurance Group Selects Insurity’s Cloud-hosted “Workers’ CompXPress Suite”
- SageSure Insurance Managers Appoints Paul VanderMarck to Accelerate Innovation
- The Commonwell Mutual Insurance Group Deploys Guidewire InsurancePlatform in Deloitte’s InsurCloud
The Email Chat is a regular feature of the ITA Pro magazine and website. We send a series of questions to an insurance IT leader in search of thought-provoking responses on important issues facing the insurance industry.
ITA LIVE 2020
ITA LIVE 2020 –SAVE THE DATE!
April 5th – 7th, 2020
The Diplomat Resort
Become a member today to receive updates – www.itapro.org/MR
BLOGS AND COLUMNS
You have surely heard it said that small businesses are the growth engine for America. Today, the phrase has a special ring to it for benefits... READ MORE
With stagnant growth and lingering low interest rates, the life insurance industry faces a challenging future... READ MORE
Finding insurance carriers willing to write commercial lines risks has always been a challenge for producers... READ MORE
As Guidewire Software prepares for the start of Connections, its 11th annual user conference that begins on Nov. 2, Brian Desmond, chief marketing... READ MORE