Despite the doom and gloom of Google entering the insurance market and auto coverage all but disappearing as a product, insurance is a profession worth pursuing, says one industry player.
“I would want all four of my kids in the business,” Jeff Purdy, the senior vice president of International Operations at
Applied Systems, told a gathering of insurance industry professionals and brokers at the Insurance-Canada Technology Conference in Toronto, Ont. this week. “Margins are expanding, and brokers are critical in that equation. Frankly, it’s a great business to be in.”
Purdy was a panelist during a morning session ‘Brokers Winning Customers,’ which included Wendy Watson, president of ORBiT, Paul Taylor, vice president of sales with Brovada Technologies and Pat Durepos, president of Keal Technology, focusing on the keys to develop strategies for successful client engagement.
Like the other panelists, Purdy was addressing the uncertainty surrounding the insurance industry today, given the recent entry of Google in the U.S. market as an online referral insurer – and the emergence of self-driving vehicles into the auto market.
Purdy urged brokers to take advantage of the technology that is available to retain and potentially grow their book of clients. “If you can focus on a strategy,” he told the room, “you can grow a great business.”
Durepos echoed Purdy’s optimism.
“I am a strong believer in ‘what doesn’t kill you, makes you stronger,’” he said. “We will emerge stronger.”
Google’s entry into the California market – and expected to expand in the coming months into several more states – allows shoppers to compare auto quotes from the 14 carriers that are participating in the site, including
MetLife,
Mercury Insurance and Safeco. The policies can then be purchased online or through an agent. (continued.)
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The site has been trumpeted as yet another online channel poised to disrupt the independent agent sector: in an interview with the
New York Times, Forrester Research insurance analyst Ellen Carney suggested the 40,000 agencies in the U.S. could “absolutely… shrink by a quarter.”
Driverless car technology has been flagged in the risk factors section of recent corporate filings from several insurers in the U.S.
Cincinnati Financial Corp., an Ohio-based insurer generating nearly a quarter of its premiums from commercial and consumer auto policies, warned in the annual report it that its forecasts could be flawed because of, among other things, “disruption of the insurance market caused by technology innovations such as driverless cars that could decrease consumer demand for insurance products,” according to the
Wall Street Journal.
Closer to home, one respected former industry veteran – George Cooke – sounded the alarm that the insurance industry needs to address driverless car technology now, or risk obsolescence.
“Look at the driverless car, it is terribly real,” said Cooke, the president of Martello Associates Consulting and former head of The Dominion Insurance. “It won’t be immediate, but there will be a transition in the next 10 years, and there will be some interesting challenges to the insurance industry.”
Mercury General Corp., an auto insurer issuing most of its coverage in California, stated in its annual report that the advent of driverless cars and usage-based insurance “could materially alter the way that automobile insurance is marketed, priced, and underwritten.”
Watson stressed the need for brokers to be proactive in maintaining customer loyalty, and using technology to that end.
“We need to keep winning the customer over and over again,” said Watson. “We have a ton of idle information, and we can use that through analytics.”
Watson shared the story of one person who received an email from his broker, telling him that the water was moving rising and moving into his area, and that he was at threat of flood.
“The brokers I see doing that are the ones who are attracting the best clients,” added Durepos. “Brokers should embrace the technology – not just the business management systems, but everything.”
