Tag Archives: statistics

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Driving to Distraction

A survey by Liberty Mutual Group and Students Against Destructive Decisions (SADD) showed that teens considered sending text messages via cell phones to be their biggest driving distraction. Of the teens surveyed, 37% said that text messaging was extremely or very distracting, while 20% said that they were distracted by their emotional states, and 19% said that having friends in the car was distracting. A January 2007 survey by Nationwide found that 19% of motorists say they text message while driving.

The federal government estimates that 30% of all crashes in the United States involve driver distraction. Inattentive driving accounted for 6.4% of crash fatalities in 2003 (the latest data available), according to the U.S. Department of Transportation. While cell phones and text messaging top the list, distractions also include radios, palm pilots, laptops, navigational aides, eating, drinking, grooming, reading, writing, television watching, and attending to children. In November, New Jersey became the second state after Washington to ban driving while texting.

Many companies are now establishing cell phone usage policies because of their concern that they may be held liable for accidents caused by their employees while driving and conducting work-related conversations on cell phones. Some policies state that employees can conduct business over the phone as long as they pull over to the side of the road or into a parking lot. Other companies have completely banned the use of all wireless devices in the car.

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Generation Y Facts

By 2017, there will be approximately 91 million Gen Yers, compared to 88 million Gen Xers and 77 million Baby Boomers. Gen Y, also known as millennials, is an important demographic, as evidenced by several recent industry studies that highlight these important facts:

  • Gen Y prefers choice in banking services. According to a survey by the American Bankers Association, 30% of those under 34 years of age prefer online banking. However, branch banking ranked a close second at 25%. It’s not a mutually exclusive relationship.
  • Gen Y is largely being ignored by the fund management industry. A global survey by KPMG found that fund managers and advisors plan to stay focused on serving the Baby Boomer generation. Only 22% of surveyed firms currently focus on Gen Y, with an additional 28% planning to focus on this group in the next two years.
  • Gen Y needs education. KPMG reports that Gen Yers need information and education about financial planning and that Gen Yers “want to look at their portfolio every day.”

Clearly, targeting Gen Y is an opportunity for insurance agents as well as wealth managers and investment advisors. Building long-term relationships with Gen Yers should include the provision of a variety of options for communicating important financial information. These options should include print, electronic, and interactive formats.

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Court Friends to Increase Sales

Global public relations firm Weber Shandwick recently released a study revealing that companies can gain a significant competitive advantage by creating marketing programs that target baby boomers’ expansive relationship networks. The survey, conducted with KRC Research, found that Boomer-to-Friend (B2F) communications are untapped in their potential to influence purchasing decisions for products and services.

According to the study, titled “B2F Connections,” boomers serve as important information sources for fellow boomers when making purchasing decisions. Nearly six out of 10 boomers (57%) are asked for their recommendations on products and services almost twice a week (or 90 times per year). Of those boomers who were asked to make a recommendation in the past year, the majority (89%) advised their friends, or fellow boomers. The study also revealed that B2F communications are circular, with nearly all boomers (93%) identifying their friends, who are also boomers, as trusted sources of information.

Boomers make up a significant part of an agency client base. Developing marketing and communication targeted to this group can help build your referral network.

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Pay Attention to Online Marketing

In October 2006, I wrote an editorial in my print newsletter, The Automated Agency Report, that said, “…an increasing percentage of the population is relying on search engines to find information. Their searches include information about products and services they are interested in buying. As more and more people use the Internet to find providers of products and services, such as insurance, agencies need to become more sophisticated in making sure they appear in search results.”

Then, just last month, I read the Online Automobile Insurance Report published by comScore. The report is based on comScore’s database of passively observed online behavior and from a survey conducted among more than 2,000 U.S. consumers during the first week of March 2007. Following are some interesting facts contained in the report:

  • In the fourth quarter of 2006, 31 million people — 15% of Internet users — visited an auto insurance Web site — more than double the 15 million visitors in early 2004.
  • 28.1 million people received an online auto quote in 2006, but only 1.6 million policies were actually purchased online in 2006.
  • Most people continue to prefer to work with an agent, but over half of customers who recently purchased insurance with an agent had also performed an online quote. When asked why they used a local agent, consumers most frequently responded that they liked having a person to visit or call. For those who did not use an agent, the main reasons were convenience and speed.
  • Over 20% of those surveyed said they would buy from the company they trust most, no matter the price. Only 10% said that they would select the least expensive, no matter what company. While most companies focus their advertising on price, people are not willing to switch unless the cost savings is substantial — nearly $500 a year.
  • When a person wants to switch their auto insurance, it is critical that they are able to obtain the information they need. People who see an auto insurance ad are more than twice as likely to visit a Web site specified in the ad as they are to call a toll-free number in the ad. Slightly more people will use a search engine to find a Web site than will call a toll-free number.
  • Two-thirds of people surveyed would go online to find more information about auto insurance. Two-thirds also say they would purchase auto insurance online. Younger customers are much more likely to be willing to purchase online.

To paraphrase Mark Twain, “Any reports of the death of the independent agent are greatly exaggerated.” Most consumers continue to prefer using a local agent. They also prefer to go online to do research (i.e. get quotes and other information) in order to ensure you are giving them the best options for their coverage. Agents and insurance companies must learn how to leverage the Internet to acquire new business and provide customer service to existing clients.

While this report only focused on auto insurance, I view the results as insightful information for any agent who wants to understand how consumers’ purchasing habits are changing and adapt marketing, sales, and customer service options to meet their needs.