A poll of auto insurance consumers in the United States certainly reaffirms the broker value proposition of the need for advice, but Canadian brokers aren't quite sure how to better educate consumers about the insurance product they are buying.
Online.com conducted a poll of 500 consumers, asking them each 10 multiple-choice questions about insurance. The average score on the test was just 32%.
The survey found that 98% of brokers' clients had no idea what comprehensive auto insurance covered. Ninety-three per cent didn't know what kinds of discounts car insurers offered, while 92% didn't know what factors car insurers used to set auto insurance rates for full coverage.
Strangely, reading the policy did not help. Those who reported reading their entire insurance policies actually scored lower on the test (28%) than people who reported that they did not read any of their policies (35%).
Part of the broker value proposition is the ability to provide a consumer knowledgeable advice about the insurance products they buy. Certainly the results of the survey show that there will always be a need for people to get advice to make up for their lack of knowledge about the insurance product.
But is there any way for brokers to raise the public's general awareness of the insurance products they buy?
"Maybe having some lunch-and-learns, if people want to come to those things at the brokers' office," said Michelle Kachur of Donnell Insurance. "It's free and if people want to attend, they can attend."
Owen Wallace of Dorchester Insurance Group said it would be best for brokers to get out of their offices and meet people in community settings such as a mall, a fair or home and garden shows.
Wallace cited the success of the Insurance Bureau of Canada's mall tours, in which the insurer's trade association sets up a display inside shopping malls and discusses insurance with passersby, and said he could see local broker associations doing the same thing. He said it would be better to be branded as a broker event rather than having individual brokers acting on their own behalf.
But educating consumers will always be a tough sell, Wallace added.
"To be honest, people just don't want to interact regarding insurance," he said. "I'm not sure there's even an appetite for people who want to learn more.
"I feel like the insurance companies could provide more education, but I'm just not sure what form that would take that would be most beneficial for people. It can't be just a piece of paper, because people don't want to read a big thick thing of policy wording. They're not going to do that, right? It should be concise and in a format that people want, whether through social media or a micro-website.
Source: Insurance Business