One of the more popular and interesting threads on Insurance Forums in the past week has been “Will technology kill the agent?”
As consumers get more and more tech-savvy, the original post ponders whether at some point life insurance could become a true commodity that can be shopped and applied for just from an app.
The responses have been plentiful and interesting, with some of the more concise opinions offered below in no particular order. To read more or add your own thoughts on this issue, please visit the thread.
1. It’ll only kill the amateur agent that only gives quotes for coverage, instead of looking for problems to solve using insurance. Also, it’s only for the self-actualizing buyer that would use an app like that. Most people are totally confused about life insurance… and I like it like that. If the agent can’t provide value for the client… that agent’s days are numbered.
2. Technology will not work without the agent. The agent is valuable in conjunction with the Internet. The agent can use the Internet to find information, and for processing the applications. With technology, if the buyer is shopping for price, they will get, just that: a price… The Internet shopper will buy improper coverages, because the shopper is basically self-diagnosing their risk. The value of an agent is the relationship combined with the agent’s knowledge. The fact-finding questions the agent asks the client, other than application questions, is what separates the agent from the boiler plate Internet. Think about this. Through experience, I have noticed that a household’s insurance agent seems to remain with the insured longer than their doctor.
3. Some carriers cut the [independents] out by offering lower rates by going direct, plus allow the agent to quote with a much higher rate. I realize rate is not to be sold. Agency, coverage, level of service, and having an agent is all worth it. Today, that is forgotten often by many, and hard to refresh to many. The question here should be: Will Direct Writers Kill the Agent?
4. Technology does not eliminate the need for the agent. However, government over-regulation such as the DNC and CMS-type regulations are a greater threat because it makes it more and more difficult for the agent to personally reach the consumers that need his services.
5. Technology will never replace salesmanship. Good consultative selling, solid conversations and empathy, will be necessary to truly increase any company’s sales in any industry, FOREVER. People have been selling life for 400 years, and nothing has changed in that time. Might be less salesmen, but so what? More for us…
6. The more complex the products are… and the more noise being said on the Internet… the more an agent is needed. As agents are aging (average age is mid-50s) and phasing themselves out… this can create a huge opportunity for those who are properly trained to capitalize on it.
• To read more or add your own thoughts on this issue, please visit the thread.
7. I understand the concern, as when carriers compete with their own agents by offering online products that bypass us. However, we agents usually have the option to use technology for our benefit, rather than be replaced by it. E.g. my husband just had a total hip replacement. Nearly every person who cared for him entered their actions in a computer stationed right in his room. But that computer can never replace the knowledge, attitude, and skill of the nurses, doctors, dietary aids, etc., who provided the services.
8. Real buyers want it easy. Of course, their opinion of easy may vary, but my experience has taught me they want it easy. If technology makes it easy for them, then they will go that way. If the agent makes it easy, then they go that way. My experience has shown me most real buyers get themselves so confused via the Internet, they are glad to have an agent walk them through the process and simplify everything.
9. The future is now. Genworth will not pay comp if you submit a paper app under $100,000. And Sagicor cuts comp if you submit a paper app under age 65. Technology will not kill the agent, the lack of it will.
10. Selling in the physical world brings higher margins. I personally make way higher margins than any online vendor. Getting people to buy something online costs a lot of money in advertising alone. Sure, if you have 100 employees then making 10% profit margin is great but all of us make a higher margin than that. Another great thing about this business, on the life side at least, is that the prices are the same online as off. People like going in to BestBuy to look at TVs and then they buy on Amazon because it is cheaper but we don’t have that BIG problem. They want to talk to someone, us, we show them the policy, then they buy because we are just as cheap if not cheaper than the online guys.
11. Kill “the” agent? No. Kill many agents? Yes. Those who adapt survive. See Darwin.
• To read more or add your own thoughts on this issue, please visit the thread.
