Progressive Starts Plan To Aid Insurance Agents' Online Sales
August 13 2009 - 11:46AM
Dow Jones News
The long-running economic downturn has turned U.S. drivers into
a nation of online auto-insurance comparison shoppers. One major
insurer has come up with a plan to help its insurance agents get
more Internet-savvy and win some of that business back.
Estimates "suggest now that the vast majority of people start
their insurance shopping experience on the Internet one way or
another, regardless of how they ultimately end up buying," said
Glenn M. Renwick, president and chief executive of Progressive
Corp. (PGR), during the company's quarterly conference call with
investors Wednesday. "When you've got that kind of a initial feed
system, the likelihood of it flowing through to people who can
actually sell on the Internet is going to be stronger," he
said.
The share of Progressive's auto-insurance policies that are sold
by agents has been dropping steadily in recent quarters, while its
direct-to-customer channel has been growing. In July, Progressive's
agency-originated auto-insurance policies in force fell 1%, while
direct-to-consumer sales increased 12%. A marketing deal that
Progressive announced Thursday with online marketing expert Web.com
Group Inc. (WWWW) will offer agents a discount on Web site and
Internet marketing services to help them gain traction online.
Progressive estimated that about half its independent agents
lacked an Internet presence, while about 73% of drivers shopped
online for auto insurance, though 67% go on to close the deal with
an agent.
Jeffrey Stibel, president of Web.com, said insurance agents are
still in "the early innings" of setting up Web sites.
He said individual agents have an opportunity to win business
from online shoppers. Most of those insurance shoppers don't go to
Web sites operated by insurance companies to buy, he said. "What
most of them do is go to Google," the Internet search engine
operated by Google Inc. (GOOG).
One service that Web.com provides is so-called search-engine
optimization, which helps an agent's Web site pop up first on
search engines when a shopper in their area types in keywords
relating to auto insurance.
Web.com's Stibel predicted that online insurance shopping will
follow the same pattern as online automobile shopping, where
dealers beefed up their Internet presence to catch the attention of
the growing numbers of online shoppers. "The smarter offline
companies are bringing their business online," he said.
Shares of Progressive were up 0.8% recently, to $16.47. Web.com
shares were off 1.7% at $6.21.
-By Lavonne Kuykendall, Dow Jones Newswires; 312-750 4141;
lavonne.kuykendall@dowjones.com