In October 2006, I wrote an editorial in my print newsletter, [1] 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.