Insurance brokers need more Facebook friends, say experts

Fast-paced technology changes and social networking trends such as using Facebook for business have many Canadian insurance brokers in a quandary.

“Brokers are having a difficult time adopting to technology because change is coming at them at a weekly basis,” according to Patrick Durepos, president of Keal Technology, a Concord, Ont-based software developer and consultancy firm focusing on the local insurance market.

Speaking at a recent Keal Partners’ education conference in Toronto, Durepos said a Keal survey of its member users also indicated that Canadian brokers are very keen on using social networking tools such as Facebook for their business, but most hardly have the time to train and experiment with new technology.

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Keal also invited Sionne Roberts, general manager of Visability, a division of IT World Canada that provides social media strategy development services for various industries. Roberts spoke on how brokers can get started on using various social networking sites to raise the profile of their firms and foster engagement with existing and potential clients.

Tight budgets and IT complexity

Durepos recounted: “One broker we spoke to said; ‘When information comes in about new technology we put it aside thinking that at the end of the week we can decide on whether to use it or not. At the end of the week, we find we need to train staff on it, get codes and documentation for it and clear if for security. While this is going on we need to sell insurance, manage accounts and provide client support…and then the following week new technology comes in.’”

Perhaps the primary piece of technology that brokers use is the BMS or broker management system such as Keal’s flagship product SigXP which integrates multiple databases and allows searches by street address, phone numbers, names, postal codes and other identifiers.

But increasingly, brokers’ IT budgets are being squeezed by demands from large insurance companies whose products they market, according to Karen Gale, broker at G&B Allen Insurance Brokers Ltd., a Warkworth, Ont-based company.

Gale said many insurance companies do not realize that majority of brokers operate alone or have a staff of less than 20 people and are budget constrained.

“The main problems are IT budget and complexity,” said Gale. “These large companies tell us we need to use their type of system in order to do business with them, but every company has a different system. In the end we have to jump over 12 different hoops.”

Social media as a marketing weapon

Remember the story about a Canadian woman being treated for depression who was later questioned by Manulife Financial about her health claim after the company saw photos of her on Facebook enjoying herself at a beach party?

Don’t worry – it’s not likely something similar will happen to you. Brokers say right now they’re more interested on how to use social networks to reach out and be “friends” with potential and existing clients rather than finger them for fraud.

“Our biggest competion are direct writers. They have the big budgets to market their products more aggressively. We don’t,” complained Brandi Machan, manager of operations for Crain&Schooley Insurance Brokers Ltd. in Perth , Ont.

Roberts, in his presentation said, social sites such as Facebook, Twitter, LinkedIn and YouTube are ideal tools that could help smaller brokers level the playing field.

“The question I am asked is ‘why Facebook, I’m an insurance broker?’” said Roberts. “I think Facebook and brokers are a perfect fit actually.”

The insurance business, Roberts pointed out, is mainly a people business. “Facebook is about connecting with people, communicating, engaging them and creating a community.”

In fact, he said, Keal’s own survey indicates that brokers are already on social networks.

He said the survey showed that 67 per cent already use social media for personal use, another 40 per cent use the technology for business and more than 25 per cent plan to use social media.

Shannon Major, marketing and communications manager for Keal said Facebook was a clear favourite of Keal product users:

  • Facebook – 85 per cent for personal use; 83 per cent for business use
  • LinkedIn – 34 per cent for personal use; 26 per cent for business use
  • YouTube – 47 per cent for personal use; 4 per cent for business use
  • Twitter – 27 per cent for personal use; 26 per cent for business use

Roberts encouraged brokers to study social media campaigns of other insurance firms such as that of HL Staebler Company Ltd. in Kitchener, Ont.

The company recently released a beta version of a street driving simulation on its Web site. “As the users drive along, they eventually encounter accidents. When users have reached a set maximum number of accidents they lose the game – but they get a $250 gift card from Staebler,” said Roberts.

Roberts likes the game because it was: creative; it was fun; it sparked interest among clients and potential clients; it had viral potential; and the game was relevant to Staebler’s business.

However, Roberts said, brokers “don’t need to go full bore” on social media if they’re not that comfortable about it.

Many firms can start by simply using Twitter to announce offers or events to client, posting offers or company event photos on Facebook or videos on YouTube to give the company a more human feel and start using LinkedIn to expand professional contacts.

“It’s not rocket science…It’s easy to get into it. But there’s a risk – if your not in social media you could potentially lose out to competitors that are,” said Roberts.

Nestor Arellano is a Senior Writer at Follow him on Twitter, read his blog, and join the IT Business Facebook Page.

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