Online Car Insurance

Online Car Insurance

Like any other American industry, car insurance has been radically altered in several ways by the large-scale adoption of the internet for business, or e-commerce. Basic education and company research, policy review, comparison rate shopping, and even purchasing car insurance online all show increases consistently year after year for the past several years. This trend is only expected to increase for online car insurance in the future.

The Insurers’ Perspective:

Much like the travel agency model, the “bricks and mortar” insurance office’s importance, while not disappearing anytime soon, will continue to wane in the coming years. And much like the travel industry giants (particularly airlines and hotels), the auto insurers who survive will do so by adopting more and better online strategies.

While the best online car insurance largely depends on the individual shopper and what he or she requires, the fact remains that this year’s shoppers will continue to buy online at a higher rate than last year and the year before. In fact, a recent published study by a major research firm showed that 52 percent of all car insurance shoppers begin their shopping experiences online. A whopping 32 percent of customers obtain quotes online exclusively. And today 34 percent have said they actually prefer to purchase their next policy online. This can only mean more purchases for online car insurance going forward.

These statistics show that insurance providers who are able to meet the challenges of online channel management and online customer acquisition strategies will thrive, or continue to thrive. In fact, the ability to manage this channel for online car insurance is a must for both the new wave (internet only insurers) and the old guard (the largest brand name insurers historically).

The Consumer Perspective:

Just because the trend for purchasing online car insurance is growing for insurance providers, does this necessarily provide any benefit for the consumers? The answer is a definite yes, as long the consumer possesses the basic internet “search and review” skills, and as long as individual insurers, aggregators, and independent agencies make more and better tools available for these online shoppers.

The shopper for online car insurance will have a number of choices. Once choice is individual company site review, as insurers, both small and large, will attempt to attract shoppers to their distinct sites. This choice may actually become less popular as there will be more “independent” sites offering one-stop comparison capabilities for car insurance rates. Besides rate comparison, these sites may also provide multiple online car insurance quotes instantly by follow up email.

With more online activity, rates will slightly decrease, based upon reduction of labor, so this trend benefits consumers overall. However, the largest benefits for the consumer will be the ability to obtain more insurer quotes, education, and even claim submission options. Even today, customer service surveys reflect a high propensity for consumer preferences for service and feedback via online methods, such as chats, emails, or formal claim entry screens.

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