Update: In Latest Ad Blitz, Aflac Challenges People to Think About Supplemental Insurance

[Corrects the Internet link to the audio interview with Michael Zuna.]

In one of its most comprehensive advertising campaigns, supplemental insurer Aflac Inc. is using its duck in new ways as it tries to get American consumers to understand what its products provide coverage for. The company's latest campaign, "You Don’t Know Quack," takes its prior campaign a step further by challenging consumers, as well as employers, "to stop and think about what Aflac is and does," said Michael Zuna, vice president of marketing for the Columbus, Ga.-based Aflac (NYSE: AFL).

And this year, its iconic duck -- which has quacked the company's name in television commercials — is celebrating its 10th birthday.

With the campaign, launched earlier this month, the public will see billboards in locations such as Sunset Boulevard and Times Square, print ads, "viral" advertising on YouTube and social media sites, product tie-ins and co-branding, as well as "duckumentaries," or mini-documentaries about the company's insurance products.

Zuna declined comment on how much Aflac is spending on the campaign, but said it's "probably our most integrated" effort to date. It most likely will continue through the second quarter of this year.

Aflac is a top player in the U.S. voluntary benefits market, particularly for disability and accident insurance.

Unlike traditional group insurance, where an employer pays some portion of employees' premiums, voluntary benefits, although sponsored by the employer, do not require the employer to contribute toward premiums. If an employee chooses to participate, the employee pays 100% of the premium through payroll deduction (BestWire, May 20, 2008). Nearly all of Aflac's U.S. business is sold at work sites via payroll deduction.

In 2007, Paul S. Amos II, who around that time became president of Aflac U.S., said he was striving to get American consumers to understand what the company's supplemental insurance products are for (BestWire, March 26, 2007).

Nearly three years later, the new campaign hopes to catch people "off guard" by challenging them by joking "Hey, if all you know about Aflac is our duck, well, you don’t know quack," Zuna quipped.

This campaign "clearly spells out" that Aflac doesn't provide major medical insurance and that none of its benefits are paid directly to doctors and hospitals but directly to policyholders when they are sick or disabled, Zuna said.

The company hopes to encourage people to learn more about its insurance because research shows that when people find answers on their own, they're "much more likely to retain that information," he said.

In the third quarter of 2009, total new annualized premium sales for Aflac in the United States saw sales declining 7.2% to $342 million, the company said in its earnings statement. Its growth in the number of new payroll accounts "remained strong and encouraging."

Meanwhile, if anything comes down with an overhaul of the U.S. health care system this year, Aflac doesn't expect health reform legislation to have "any major effect" on its business, Zuna said. The company does very well in Japan, where a national health care system is already in place, he said.

About 75% of Aflac's total earnings come from Japan. It says it's the No. 1 insurance company in terms of individual insurance policies in force in that country.

American Family Life Assurance Company of Columbus currently has a Best's Financial Strength Rating of A+ (Superior).

To listen to the entire interview with Zuna, go to: http://www.ambest.com/media/media.asp?RC=168237

(By Fran Matso Lysiak, senior associate editor, BestWeek: [email protected])