Social Media | Novarica Blog

Matthew Josefowicz

I’ve seen a number of blog posts and articles over the past year warning agents not to get too excited about social media, since insurance prospects still favor other sources of information over social media…like personal friends and family.

As if social media wasn’t one of the most important ways that personal friends and family communicate.

This reminded me of a general principle for insurance and financial services technology: Technology is not a “what,” it’s a “how.”

No company needs a web strategy, a mobile strategy, a cloud strategy, or a social media strategy. What they all need is an awareness of the roles that these technologies play (or will play) in how their customers want to do business and how their companies can operate most efficiently.

For example, our Social Media and Independent Distribution report this year showed that 25% of agents/brokers under the age of 40 use social media to communicate with their underwriters. But this doesn’t mean insurers need a social media strategy, it means they need to incorporate an understanding of social media into their distribution strategies.

Karlyn Carnahan

Novarica’s latest research report, Insurer Social Media Strategies for Independent Agent Distribution, addresses the use of social media by insurers with independent distribution. Surveying insurers that write through independent agents as well as independent agents themselves, we looked at social media usage rates, the different rates for different uses, and the preferred platforms (especially Facebook, Twitter, and LinkedIn) for various uses.

We found that a striking majority—more than 70%–of the insurers we surveyed have some presence on Facebook, Twitter, or LinkedIn. However, 40% or more have no official social media policy in place—a fact that could create compliance risk and limit the company’s ability to capitalize on social media activity.

Additionally, about 30% of insurers responded that they use social media for one-to-one communication with both agents and policy holders. This suggests that some of the critical communication that used to take place via telephone or email is migrating to social media platforms. This data is notably split by age, as 25% of agents under 40 report using LinkedIn to communicate with specific underwriters at their insurers, double the percentage of those over 40. More communication may migrate to social media platforms, then, as baby boomers move into retirement and are replaced with GenX and Millenials.

The report concludes with a discussion of six ways insurers are supporting agents’ social media efforts, as well as four key recommendations to ensure insurers best leverage social media within their distribution strategies. Insurers that write through independent agents must understand that changes in communication platforms and behaviors will affect their most critical capability: their ability to manage relationships and communicate effectively with their distribution partners.

A free preview of the report is available here.