Internet Strategy for Insurance Companies
Developing an Effective Internet Strategy for Insurance Companies
There is too much hype and overstated claims associated with the Internet in every industry.
This is especially true in the insurance business. In fact, there are some signs of a
"dot.com backlash" because senior executives instinctively mistrust many of the claims and
projections related to the Internet. However, ignoring the reality of the implications and
opportunities of the net would be a serious mistake.
The "Hype"
The "Reality"
· All insurance sales will be online in 5 years
· Net based technologies will radically
change how we do business with our
· Insurance.com will be bigger than all existing
customers, agents and internal and
insurance companies in 2004
external business partners.
· Agents and brokers will be extinct
· If you don't have an Internet strategy
to generate revenue, reduce costs and
· E-Commerce is going to replace all other
provide better service, your company
transactions
will be at a competitive disadvantage.
No matter how successful you are
today.
The Need
Many executives are understandably struggling with the issue of how to define and implement
an Internet strategy. The emphasis has been on building "brochureware" sites that offer little
value for customers. There is also a growing sense of some vague need to do "E-Commerce",
but with little definition or understanding of the implications of that decision. There has also
been limited discussion about the true value of the Internet in terms of reshaping business
practices and delivery systems.
The result of this has often been a paralysis within the insurance industry. Banks have moved
much more quickly to push technology to their clients as demonstrated by industry leaders like
Wells Fargo Bank and KeyCorp. Banks outspend insurance companies 4:1 on technology and
net based capabilities. This trend is reflected in the following chart.
1
