PIMA 2006 and Internet Technology for Online Health and Life Insurance Sales

August 10, 2006 - Maybe it’s not BIG BUZZ, but the use of Internet technology for online health and life insurance sales and services is now part of the mainstream conversation.  Mike Wise, IdeaStar vice-president of insurance technologies, recently returned from the Professional Insurance Marketing Association (PIMA) Summer Conference 2006 in Napa, CA.  It is a significant networking event for carriers and distributors.

 “A year ago, online services didn’t seem part of the conversation at PIMA. Now there’s a lot more talk about online e-signature, quoting, agent registration, customer self-service, and the many other front-end tools which can save an insurance organization time and money. It may be number five, but at least it’s on the list of things to talk about,” Mike said.

This year’s conference theme was Product Strategies in a Maturing Industry.

“There are new dynamics developing as many small businesses, out of concern for costs, are opting-out of providing employee health coverage,” Mike said.  “Thus there seems to be a declining pool of group insureds, resulting in decreased revenue to the carrier. It seems clear that carriers can’t make up the loss by increasing premiums. So they’re looking to online technology to save administrative time and cut costs (and perhaps reach the individual insured) – something IdeaStar has a lot of experience in,” Mike said.

A lot of the “buzz” at the conference was the connection between the baby boomers and the Internet.  Some attendees think it is not a big deal, but it is, Mike said. Middle Income and affluent boomers with kids have proven to be heavy users of the Internet. “You can’t depend on traditional marketing to reach them,” Mike said.  “As an example, if somebody is looking at their credit card statements and using online bill-pay, stuffing an ad for health insurance inside the paper statement might not have the intended effect. They might not even open the envelope,” Mike said. And, he added, e-mail marketing has been rendered ineffective by spammers, with the exception of customer-base and affinity approaches.

The new marketing hope is search engine marketing and affinity marketing. Search engine marketing matches potential clients with insurance products for which they are searching at the moment they are interested. In affinity marketing, putting a banner or text ad on an alumni Web site, for example, attracts attention to perhaps catch the interest of an alum at a point when they have a need, Mike said. 

With online technology, associations can choose whether to include a broker or establish a system of customer self-service.  “IdeaStar is on the leading edge of online small group health insurance sales. Many are doing quoting, but we’ve added online enrollment.  It’s right in line with the consumer-driven health insurance market.”

It’s clear that Internet services are becoming more and important in the health insurance industry, Mike said. “The question is which companies will make the most profitable use of the emerging technology.”

For more information, contact Mike Wise, IdeaStar Vice President of Insurance Technologies, at 216-674-1600 ext. 116.