More than 70 percent of insurers that distribute through independent agents also use Facebook, Twitter or LinkedIn as a part of their communications strategies, according to a new report from Novarica.
In “Insurer Social Media Strategies for Independent Agent Distribution,” Novarica also found more than 40 percent of insurers have no official social media policy, which could result in compliance risk and limit opportunities to capitalize on the technology.
Many insurers with independent distribution now use social media for one-to-one contact with their agents, which suggests social media is beginning to replace telephone or email usage. Not surprisingly, the adoption of social media is still dictated by age. A quarter of agents under 40 use LinkedIn to communicate with specific underwriters at their insurers, which is twice as many as those over 40.
“Social media is playing a growing role in the communications strategies of insurers across the board,” said Matthew Josefowicz, Novarica managing director, partner and co-author of the report. “This is a fact of life that will only increase as boomers retire and are replaced by GenX and Millenial agents.”
Increasingly, insurers are using social media to find prospects, enhance customer relationships and communicate with distributors. The report also found significant usage by agents to find prospects and manage customer relationships.
“Too many insurers that rely on independent agents are still treating social media the way they treated the Web in 1999,” Josefowicz added. “Changes in communication platforms and behaviors will affect these insurers’ crucial abilities to manage relationships and communicate effectively with their distribution partners.”
The report also presents six ways insurers are supporting their agents’ social media efforts, including:
• Inform: Include social media in general marketing support
• Instruct: Provide specific instruction in social media
• Include: Include agents in social media activities
• Content: Provide content
• Capabilities: Create sales-oriented applications
• Strategic partnership: Involve agents in overall strategy
The report also includes four recommended steps for insurers to consider social media a part of their producer relationship management strategy and bring marketing, underwriting, and compliance into the formulation of social media strategies and policies:
• Producer Relationship Management: Insurers must understand which of their producers are using social media and how best to support their efforts to reach prospects and streamline communication with underwriters.
• Marketing: Insurers should work with marketing departments to provide content and training for agents.
• Underwriting: Insurers should train underwriters and marketing representatives on how to engage with agents.
• Policy development focused on supporting distribution, not just managing risk. Insurers must formulate policies to guide social media use by marketing and distribution staff. Policies should be focused on building and supporting agent relationships and avoiding compliance risk.
The report is based on 82 surveyed insurers that write through independent agents, and 150 independent agents, on the rates of social media usage and preferred platforms for different uses and actions.
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