Advances in computer technology mean insurers will have to foster much closer relationships with their customers or risk fading away.

That was the unequivocal message made to a group of South-West insurance companies at a discussion forum organised by IT services provider CMG.

Insurers including Cornhill, Legal and General and Zurich IFA group were told that PCs and the internet allow insurers to tailor their services to individual customer needs.

"Customers needs can vary hugely," said the associate director of CMG's Bristol office, Graham Higdon. "Some will research the market very carefully before making any contact with an insurer, whereas others need a great deal of help and advice at an early stage."

Higdon added: "Some prefer to do business face-to-face, others over the phone and some people are looking to use the internet. Unless insurers can match these expectations they may quickly lose out."