Monday, November 16th
9:30 a.m. - 10:30 a.m.

Bridging the E-Commerce Gap: Linking to Outside Producers

-- John Albanese, Penn Mutual

"Insurers Urged to Use Internet "

By Meg Green
Associate Editor

Insurers can harness new technology to better serve their producers by providing information faster and easier, said John M. Albanese, senior vice president of information systems and customer services for the Penn Mutual Life Insurance Co.

"The producers are our customers," Albanese said. "Some people say that's heresy, that the policyholders who pay the premiums are our customers, but it's the producers we need to deliver business value to."

Albanese said insurers compete with each other to entice producers to offer their products, and it's on the producer level that insurers must offer a better business value.

Albanese spoke Monday at the Fulfilling the e-Promise, A.M. Best Co.'s annual insurance information conference in Boston.

He said in Penn Mutual's case, 40% of new life insurance is sold through career agents while 60% is sold through independent agents. In a recent phone survey of Penn Mutual's agents, about two-thirds of agents were online, and another 15%-20% were planning to go online within the next six months.

The Internet can be used to improve communication, delivery, service and education, Albanese said. Insurers need to tap into the speed of the Internet to save time and money.

For instance, about 20%-25% of calls coming into the home office are follow-up calls from agents. The Internet could eliminate the need to make those calls. He suggested insurers use electronic communication as a supplemental way for agents to file and receive forms, then eventually wean the agents off and use electronic means as the primary way to communicate.

Another benefit from electronic commerce is it can give producers a "trigger"-- a reason to contact clients and an opportunity to make additional sales, he said. Producers want to be the first point of contact for all client interactions.

However, there's no reason to bombard agents with information they're not interested in hearing.

"A lot of what we deliver is noise," Albanese said. "When it ceases to become noise and becomes information is when they (producers) have to act on it."

However, producers move at their own pace, he said. "The sense of urgency is on their timeline, not ours."

Even if electronic commerce is a small percentage of all insurance business, it's worthwhile for companies to begin setting up their electronic programs, Albanese said.

"If you wait until you can economically justify investing in something, you'll be behind the game," he said.

Albanese said technology would never replace face-to-face interaction between clients and producers, or producers and field managers.

"This business is relationships," he said. "[Producers want] us to use technology where the value is immediate and the lead time is minimal."