Nearly one-in-five buyers of property, general liability, business-owners policies and professional liability coverage initiated their purchase online, through an insurer’s website or an aggregator site, according to Deloitte’s “Voice Of The Small-Business Insurance Consumer Are Buyers Ready To Take The Direct Sales Route?”
Just one-in-four of those surveyed said insurance policies were hard to understand, 35 percent said they were easy to understand and rest were neutral.
Of the respondents, 16 percent said they would very likely buy one or more coverages direct from a carrier online, and an additional 35 percent said they would be “somewhat likely to buy direct over the Web.”
Smaller businesses were found to be more interested in shopping online for commercial insurance; 28 percent with less than $100,000 in annual revenue said they were “very likely to buy direct,” as did 18 percent of those with revenue between $100,001 and $250,000. About 10 percent of those with revenues between $1 million and $5 million said they were “very likely to buy online.”
While most shoppers (84 percent) said they expect discounted prices for buying direct, those expectations are not high, Deloitte said. Of those online shoppers, 23 percent expect a discount of 10 percent or less and 36 percent expect savings of between 11 and 15 percent.
Online shoppers were not equally interested in various coverages. Of those who said they were very likely to buy online, 67 percent of respondents who said they were very likely or somewhat likely to buy online were interested in general liability, followed by property (46 percent). Shoppers were less likely to buy workers’ compensation (29 percent) and professional liability (29 percent).
Deloitte postulated that some were hesitant to buy workers’ comp direct “because the coverage tends to be the most costly part of their commercial insurance portfolio, and is generally shopped by agents annually.”
Despite the willingness of business owners to buy insurance online, Deloitte found just one company allows people to enter risk information, receive a quote and conclude a transaction online. Others refer shoppers to an agent in their ZIP code, offer to have an agent call with a quote, or offer the opportunity to speak with a call center agent. Aggregators either refer shoppers to carrier websites or arrange for an agent contact them.
Results are based on an online survey of 751 U.S.-based small-businesses that was conducted from late February through late March 2013.
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