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Foolproof's 2006 Online Shopping Survey into insurance predicts rapid growth in online purchasing of motor and home insurance policies, but points out that growth is hampered by poor usability.

The good news for online insurers is that consumers see the benefits of avoiding long phone calls for quotes and insuring online, but insurers are urged to make improvements, especially when it comes to usability.

Two-thirds of those surveyed plan to buy their next motor insurance policy online, compared with 32% who currently do so. Greater growth is predicted by 2016, when 82% of insurance products are expected to be purchased online.

The growth of aggregator sites like Confused.com and Moneysupermarket.com, which allow consumers to quickly compare a range of quotes, is diverting consumers from insurer’s sites. Aggregator sites were used by 66% of online insurance customers this year.

Only three brands, Tesco, Norwich Union and Direct Line are sought out by consumers directly. With 82% using the internet as the primary source of insurance information, insurers need to improve their visibility on both search engines and aggregator sites.

Foolproof also found that online insurers are losing customers due to usability issues with the quote process. The survey found that 23% of potential customers abandoned quotes in frustration, without waiting to get a price.

Occupation questions were cited as the principal reason for quote abandonment, as customers often cannot find their occupation listed on insurer’s sites. Customers even run the risk of invalidating their insurance if occupation details are incorrect, so you can understand why they drop out.

Insurers are advised to make the quote process as easy and quick as possible to avoid losing potential customers through frustration with the process.

In addition to the issues of usability and visibility, online insurers have previously been criticised for poor standards of customer service.

With so many people using the internet to research online, especially in the case of motor insurance, some companies need to raise their game to take full advantage of the increase in traffic.

Graham Charlton

Published 13 November, 2006 by Graham Charlton

Graham Charlton is the former Editor-in-Chief at Econsultancy. Follow him on Twitter or connect via Linkedin or Google+

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Comments (3)

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Laurence Veale, Commercial Manager at IQ Content

We did a similar survey during the summer and found very similar issued. Titled "Benchmarking the user experience of car insurance websites", it's available for FREE from our website at the following address:
http://www.iqcontent.com/publications/reports/online-insurance-benchmarking-2006

about 10 years ago

Terry Golesworthy

Terry Golesworthy, President at The Customer Respect Group

Do you have a reference for saying that 82% of people use internet as primary source of information. This is a very compelling number clearly and drives everything frm that point.

I am surprised at the level of the occupation hurdle, I would have thought personal and sensitive information would be more of a barrier especially those who are price comparing.

over 7 years ago

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Gio Best

Having tried to use a car insurance comparison website, I can confirm it is a bit of a nightmare. The forms are very detailed and unforgiving - if you have any uncertainty, it's not like you are sitting with a broker who you can ask for clarification - and if you get your answer wrong you risk invalidating your policy and losing an insurance claim should one arise. However, car insurance comparison websites do offer value in that they provide a general market overview of a guide price for your insurance - which can come in handy if you do go to a broker as you can negotiate the price by showing you've already done your research!

over 6 years ago

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