The brave new world of online sales

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Protection markets are failing to evolve and must seize new opportunities if they are not to become dinosaurs in the the digital age, says Emma Walker.

In a world that is changing fast, the protection industry is failing to demonstrate a willingness to evolve with the customer, particularly when it comes to adapting to the digital age.

The ‘protection gap’ is widening and protection is still largely focused on the IFA sales model. However, in a post RDR world, many consumers choose not to go down this route, instead they opt to go online for their protection needs.

This is where an opportunity lies for the protection industry in not only the provision of more digitally focussed customer solutions, but also in the design and provision of products.

The industry requires fresh thinking about how it approaches protection sales and not just to rely on the IFA solution, with a few tweaks for online.

We need to be clear, IFAs play a vital and important role in the sale of protection products, and they always will, but the focus on the IFA sales model by the industry is preventing real innovations in the online space.

Insurers may be happy with the current model, and why not? It works. However, can the industry look in the mirror and really say, hand on heart, that it is doing enough to help consumers? Bar a few exceptions, the protection industry appears to be lagging behind the rest of the insurance industry.

The current online journey for protection sales is often disjointed and in most cases leads the customers down a telephone route, when many just want to find the right information and make an informed choice without necessarily speaking to an expert.

Lessons can be learned from the aggregators who have helped make the purchase of general insurance products straight forward, using innovation to remove some of the barriers which prevent customers from transacting online.

Consumers do not think twice about going online and buying home, travel or car insurance as these online journeys are straight forward, and a relatively simple process allowing the customers to obtain a price based on their own individual circumstances and requirements.

A customer is able to use that information to shop around, compare policy details and add ancillary products before choosing to make a purchase. General insurers continue to innovate to make purchases easier for consumers, whether they visit on a desktop, smartphone or tablet or through traditional channel through brokers and over the phone.

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