Burning issues in the world of IT have recently focused on insurance brokers and how they can harness the internet to improve business processes. However, this has failed to recognise that insurers are the ones best placed to take full advantage of the web.

Brokers are investing large sums of money in developing IT systems, as they realise the internet is the ideal medium to reach a large and relatively unknown audience. Many companies notice that the investment required for reaching customers on the internet is decreasing every year. With this realisation, brokers have managed to create a niche in the market - the online insurance shop. With this new way of reaching out to potential customers, overhead costs are reduced and profits can be increased.

The industry is filling up with intermediaries of all sizes, offering every type of insurance; from the one-stop shop, call centre-based direct brokers handling the smallest of policies, to large commercial-only policies.

Some large insurers have already taken the step to organise their services online. This allows brokers to procure information on policies and existing clients quickly and easily, aiding their methods of working. Customers are also able to find the answer to many of their queries online.

Using the internet also has excellent benefits for reaching a larger target audience. As more people become comfortable using the internet for everyday activities, it will only be a matter of time before jobs like renewing your car insurance or amending your policy will be done via the web in a matter of minutes.

This process of cutting out the middle man and going straight to the insurer could send a few hearts fluttering in the broker's office, but could open many new doors for the customer.

A website designed for the benefit of the customer with easy navigation makes it a lot simpler for the customer to procure a quote or buy a policy online. Once the customer has had a good experience with their insurance company, they will be more likely to renew their policy with it.

By allowing customers to become more self-sufficient and extending the hours of operation to 24-7, insurance firms are able to free up staff to handle more complex customer requirements and promote new services and products - all of which help to provide better customer service.

The advantage to the insurers lies in the vast pool of data stored on their legacy systems, which hold the personal details and financial information of every current and previous policyholder. These systems are a priceless commodity when used for marketing and sales activities and a necessity for financial checks on policyholders. This information is kept in a system that is easily accessed - using dumb terminals and green-screen technology.

This technology will have been initially built at the company's adoption of IT - often in the 1970s. These solutions are based on mainframes that are capable of holding vast amounts of information, working endlessly to make sure that the information is available on request. Unfortunately, many of these, having been designed before the days of the commercial web, cannot operate via the internet.

If any of these insurers are going to see their policies reach a wider audience without the intermediary help of a broker, then they need to modernise these systems to meet today's business requirements.

Brokers are already building online brands and it is important to move quickly before the market place is defined and divided between the current players.

  • Suzie Phillips is marketing director at IT solutions company Jacada.

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