Just because you reach them doesn’t necessarily mean they’ll come. According to Chad Hersh, a principal in the insurance practice at Novarica, in order for insurers to acquire 4,500 new customers, they must market to 1 million consumers. And this, he said, is just one of the reasons insurers should use aggregators.

Today, Hersh joined Brian Schlessinger, VP/practice leader of financial service at Nielsen Online, to answer the question, “Insurance and the Internet—Who’s Visiting, Who’s Buying?” at the LOMA Distribution Technology Conference in San Diego, Calif.

Among the many reasons—new business, volume, data, fill out media mix—Hersh highlighted for using aggregators, brand control may perhaps be the most important.

“If you reject an applicant through an aggregator, they may never see your company name,” he said, implying that the applicant won’t gain a negative perception of the insurer.

Another significant benefit to using aggregators, Hersh said, is cost savings on advertising. “The aggregators are paying a fortune to advertise, so insurers don’t need to.”

Schlessinger touched on Nielsen Online research that showed aggregators are advertising heavily on the Web. In the last 12 months, he said, InsWeb spent five times as much as The Hartford on online advertising.

Despite the numerous benefits, there are, of course, challenges to using an aggregator. Hersh pointed out four of the most critical areas for insurers to consider when looking at working with aggregators:

• Channel mix — insurers will need to figure out how to build the agent into the process

• Fulfillment processing — applicants accessing information online expect fast activity

• Brand — insurers will be placed next to their competitors, requiring focus on price competition

• Accuracy — underwriting assumptions and fraud may occur

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