Could Insurance Be Googleized?

CHICAGO -- Tech companies such as Google and Amazon have transformed the way Americans receive goods and services. Could insurance and retirement products be next?

A panel convened by the Insured Retirement Institute thinks there is an opening that would enable a company with a stronger platform, delivery system and big data capability to undercut the industry.

"There will be a company that we've never heard of before and never thought of before coming in and taking massive market share of our business," said Kevin Kennedy, managing director/head of individual annuity business for AXA Distributors.

Kennedy spoke during the end of the View from the Top panel's 90-minute discussion. He found little disagreement among the other three panelists.

BlackRock could go to Google right now and develop a working model for delivery of retirement services that could "redefine the industry," said Peter Cieszko, senior vice president with American Century Investments.

The panel helped close IRI's 2017 marketing conference. The industry needs to innovate, be willing and able to adapt, and find ways to bring in new talent, panelists told attendees.

The industry advisor count dropped for nine years straight before ticking up 1 percent last year, Kennedy said. The graying of the advisor force is a real problem, he added.

"We've got to find a way to make it more attractive for young folks to come in," he said. "We've got to find a way to make it more attractive for women to come in."

Panelists discussed how technology is driving changes across many other industries. And at a much faster pace than in the retirement advice world.

Cieszko described a visit to The Washington Post, where they furiously track readership. But they are doing so in incredibly detailed ways, he explained. The Post tracks which parts of a story readers are spending the most and least time reading.

"They would actually have the writers fine-tune and recalibrate that article in real time to make it more interesting for the readers," Cieszko said.

In addition, advertising is targeted to readers based on their age and other web usage.

Meanwhile, the insurance industry hasn't yet figured out how to take advantage of video, said Scott Coutto, president of Fidelity Institutional Asset Management.

"It's amazing to me that this industry doesn't embrace video more," he said. "If I could see 20 advisors in a day, that's a great day. If I could up that number to 50 because I don't have to travel from branch to branch, that's impactful."

Change is coming regardless, Coutto added. More brokers are transitioning to advisory, and the regulation pressure from Washington will force more consolidation.

"We need to step up our efforts. We should not be where we're at," Kennedy said. "I think we need to do a better job at financial literacy, number one."

 

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected].

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