As an insurance professional you might consider Google’s announcement last week of www.google.com/compare/insurance as a threat, or an opportunity, or a conundrum. Does that about sum it up? But what does it mean for the industry, for the future of insurance distribution, and for you as an insurance professional?
Based on the premise that the customer is always right, Google’s announcement of its Google Compare Auto Insurance Services should mean a huge win for the consumer and for those insurance providers that get on board the new (well, actually not so new) consumer bandwagon. Some readers of this article might think they have made the change, focusing on customer centricity and a quality customer experience. Yet I believe this move by Google may be the catalyst of a seismic shift in how consumers shop for and buy insurance. While some insurers have already embraced direct-to-consumer sales channels, others continue to wait on the sidelines. Agents also have an integral role to play in this new Google service, but they will need to be sufficiently tech- and consumer-savvy in order to take advantage of their opportunity.
Easy Quote and Compare
With its new service Google introduces an easy insurance quote and compare process. Since I’m already online and using Google’s search engine to find car insurance, it’s a natural and easy transition to then actually purchase a policy. And given which carriers I might choose to get quotes from, I’ll be able to choose to buy the way I want—either directly, through a call center, or to an agent for further assistance.
What does it take to buy a P&C auto policy? Internet access and a credit card? Some companies are going to make it just that easy and fast. And they will use Google to start an efficient and pleasant consumer experience—something Google has mastered. Does the insurer have good policies? Is the consumer getting a good deal? Will the consumer stick with that company? The answers will be up to the insurer.
Not About Disintermediation
Some might think it a stretch to compare insurance distribution channels to what happened in the phone market, but the analogy to today’s circumstance is evident: changing consumer behavior, perceived changing consumer needs, and dramatic advances in technology such as mobile have made a shift inevitable. Remember in mid-2007, just a mere eight years ago, we were first introduced to the iPhone. Look what has happened to the mobile phone industry in that short timeframe—calling it a phone any longer is hardly describing its capabilities.
The rapid advancement of technology, coupled with changing consumer behavior, is not about disintermediating anything or anyone in the insurance value chain. Rather, it is about finding ways for us as an industry to leverage those technology advancements to give consumers what they want and how they want it. The trusted advisor, in consumers’ estimation, will be the one who can deliver—whether that be the insurer, the agent, Google or someone else.
In 2007 consumers didn’t yet know they wanted smartphones. I remember thinking I would have no use for all those capabilities—I just want to be able to make a call. It didn’t take long for the paradigm shift to take hold. Who knew or even contemplated this incredibly rapid shift? In the same vein we’ve been talking about the coming distribution disruption in insurance for years. Is it finally here? Is the Google approach the model for how consumers want to shop for car insurance? The question you should be asking yourself is not “What if it isn’t?,” but rather “What if it is?”
The goal of Google’s model is simple: give consumers what they want, how they want it, and when they want it and they might just reward you!
Insurance agents, friends, family, and neighbors will still be trusted advisors. They can share why they recommend a specific policy or company, why they bought a given insurance policy, why from that company, what type of deal they got, and what their experience has been. Today, I can also get that online, with opinion and feedback from a broader sampling of consumers, and with a bit of experience and online research I can also determine if what I’ve seen and heard has merit. In most cases I can get it a whole lot faster. For me, and millions more like me, I have a new trusted advisor. If I’m already online doing research, why wouldn’t I just ask for insurance quotes?—especially if Google offers me that option?
As more people research their options online, choosing, and buying insurance as part of that research process is a natural progression. Google’s search engine is trusted by hundreds of millions of people in the U.S., and everybody driving a car needs car insurance. I don’t think it is much of a stretch to think that many consumers will try this service, as I believe Google will strive to make it the best consumer experience possible. And the service will only get better over time. There is certainly no doubt that Google is a force to be reckoned with.
As insurance professionals we are well aware of the power of the consumer and Google has drawn a new line in the sand. Ultimately the consumer will decide. Are you ready?