Why Insurance Agents Must Join the Social Media Revolution
Independent insurance agents need to acknowledge that having “a Web presence is non-negotiable,” according to Michael LaRocco, president and CEO of Fireman’s Fund Insurance Companies.
LaRocco said that consumers today – “tomorrow for sure, but also today” – already are sharing and gathering information about people, products and brands through social media, which influences their purchasing decisions.
It’s not just the younger generation using social media. In fact, 55- to 65-year-old females are the fastest growing segment of Facebook users. Given its total number of users to date, Facebook would be the world’s fourth-largest country. That means an insurance agents’ kids, sisters, brothers, colleagues are using Web 3.0, he said.
Yet LaRocco lamented that only 48 percent of independent insurance agents have Web sites and only about 20 percent keep the sites updated. “This is not good,” because having a Web presence is becoming a necessity as a networking tool globally, he said. “We have to leverage opportunities to make us more efficient and effective.”
Leveraging social media tools is relatively easy, he said. “The cost of entry is low, and you can get into it in a very efficient manner if you have one staff person who understands and uses social media. Once you spend some time with it, you’ll see rewards many times over.”
Social media should be used for discussions, not as a sales tool. Independent agents can use social media to become known as the “best source” for advice, LaRocco suggested. For instance, an agent could educate consumers on insurance coverages, or provide a forum for disaster preparedness and recovery information. For agents who write personal lines and have customers who are going to college and coming off and on their parents’ policy, social media can be used as a tool to discuss family and social issues.
“You can get to a lot more people this way than on the golf course,” he said.
Putting up a picture of his 18-year-old daughter, LaRocco said the next generation of insurance buyers won’t want to communicate with their insurance agents in the same way as previous consumers.
He said that while Geico spent $800 million last year on advertising, independent agents can compete with that if they build the right relationships with their customers.
“(Customers) aren’t going for geckos; it’s a lifestyle choice,” he said. “That’s how they want to interact; they’re choosing an approach, not a company.”
He said there’s no reason an independent agent can’t also provide an online channel for customers, but then provide an added bonus of professional advice when and how customers need it. He said the Internet also can help agents better target customers, such as an association of dry cleaners, or potential customers in the immediate vicinity of a college.
“At the end of the day, insurance is a relationship business. But the relationship can be delivered in different ways,” he said. An agent might deliver information to a customer through Skype. Noting his daughter, LaRocco said she isn’t likely to do business with someone who gives up on trying new technologies and can’t meet her needs.
“The younger generation wants you to meet their needs in technology,” he said. “You’ve got to stay connected because information and recommendations about information is changing.”
The good news, however, is that “the sky is not falling,” LaRocco said. “The opportunity is great because I don’t know that enough insurance agents will go here fast enough, and those that do will have an advantage.”
LaRocco spoke at the Insurance Industry Charitable Foundation’s 11th Annual Educational Forum, presented by the Chartered Property Casualty Underwriters Society and Insurance Educational Association.