Agents' use of the Internet continues to surge

NEARLY nine out of 10 readers of this magazine now have access to the Internet. That was one of the more striking findings from the 2000 American AGENT & BROKER Survey, our 35th annual look at the magazine's readers. This year's survey, which was sent out to 750 readers, drew a 51.6% response

Increasingly, agents and brokers appear to view the Internet as an indispensable tool. In this year's survey, 89% of the respondents reported that they have access to the 'Net, up from 74% last year and 52% the year before. Agents' actual use of the Internet also showed a big increase in this year's survey. Indeed, 71% of the respondents with Internet access said they log on to the 'Net every day, up from 49% in last year's survey and 45% from the year before. Another 13% reported that they get on the Internet every two or three days, and 6% said they sign on at least weekly.

While the survey results show that agents and brokers have been eager to obtain access to the Internet and the World Wide Web, they appear to be less interested in creating Web sites of their own. In this year's survey, the percentage of respondents who have sites rose by just 7 points (to 37%) after rising by 11 points the year before.

Although about two-thirds of AA&B readers still do not have Web sites, those who do seem to be putting them to greater use. This year's respondents who have Web sites reported that they use them for the following purposes:

-97% use them to give visitors general information about the agency (up 2 points from last year).

-54% use them to solicit leads (same as last year).

-46% use them to obtain quoting information from visitors (up 14 points).

-27% use them to provide visitors with links to other Web sites (up 5 points).

-27% use them to give visitors risk-management information (up 9 points).

-17% use them to provide real-time quotes to visitors (up 6 points).

-14% use them to furnish certificates of insurance to customers (up 8 points).

-12% use them to accept notification of claims (up 7 points).

Fifty percent of the respondents to this year's survey also indicated that they use the Internet in some way to transact business with their carriers. That was up from 33% in last year's survey.

Production

In the past few months, rates have started to firm for some commercial-lines products. Perhaps not coincidentally, readers' production figures showed a slight improvement in this year's survey. The percentage of respondents who said their premium volume increased between 1999 and 1998 was 64%, up 5 points from the comparable figure in last year's survey. The percentage reporting that they earned contingency income also was up, to 76% from 72% the year before.

The majority of respondents to this year's survey-52%have more than $2.5 million in premium volume. While that figure was up just a point from last year, the percentage of readers with higher volumes showed a larger increase: 23% of the respondents have volume exceeding $10 million, up 7 points from last year.

To supplement their income from property-casualty sales, 81% of the respondents to this year's survey sell life insurance. That figure was unchanged from last year. Fif teen percent offer fee-based consulting services, up 3 points from 1999.

Markets

While agents doing business in certain parts of the country undoubtedly have trouble finding carriers to represent, the results of this year's survey indicate that the overall picture is improving. Sixty-nine percent of the respondents reported that they represent six or more insurers, up from 62% last year. That includes 38% who represent 10 or more companies, up 3 points from last year. When placing business, agents and brokers also can avail themselves of the services of managing general agents and surplus-lines brokers. In this year's survey, 90% of the respondents said that they do so, up 2 points from last year.

One way that agents looking for more markets can find them is by joining "clusters." In these organizations, which come in a variety of forms, affiliated agents share certain expenses and use their combined volume to gain access to more companies. In this year's survey, we asked readers for the first time if they are members of a cluster and learned that 15% of them are.

Bank-agency relationships

Following the 1996 U.S. Supreme Court decision in Barnett Bank Us. Nelson, banks have been free to become more involved in selling insurance. Their authority to do so was further enhanced by the passage last fall of the Financial Services Modernization Act. To this point, however, agency involvement in bank-related insurance selling remains modest. In this year's survey, 6% of the respondents-up from 4% last year-said that their agencies either were bank-owned or that that they sell insurance for a bank under the terms of a joint venture or other arrangement.

This month, we publish an article on page 52 presenting the results of another study, from the Academy of Producer Insurance Studies, that we think readers will find interesting. Its statistics concerning agents' access to the Internet in 1999 jibe closely with our own, giving us even more confidence in our figures for 2000. By next year, it looks like practically everyone will be on the 'Net.