Why isn’t your broker made of silicon yet? Channel conflict. Incumbent carriers cannot turn their backs on the agent and go direct-to-consumer without the risk of offending their agent networks. So much existing and referral-based business is at stake that most carriers do not allow consumers to purchase insurance online — they make consumers purchase through an agent.To keep the peace with agents, most carriers will provide an online quote, then direct you to the nearest agent instead of an online checkout (driving you from online to a retail location, what a horrible experience).
Well, it won’t be exactly like Uber. More like Amazon’d, where there’s not much reason to go into a brick and mortar. Or in this case, to talk to a human.
It’s fascinating to realize that there is still this massive legacy THING sitting in the way of progress, and that this thing is millions of insurance agents.
Stated differently, insurance would be much better for consumers if you could just interact directly with the company itself.
But you can’t because you need to go through an agent. And the insurance companies don’t want to anger them.
How long will that last?
Not long at all.
What will happen is series of companies will pop up that don’t have agents, similar to what’s happening now with P2P banking and loans, and those companies will become wildly popular.
Then the traditional ones, many years later, will abandon the legacy model. But only then. Once the blood is all over the floor due to their timidity.
The human element
But what about human jobs? Isn’t this a problem if we’re eliminating all these positions that will then be unnecessary?
Well, sure, but that’s happening to most fields.
My recommendation: enjoy the improved service that comes from improved automation and wait for Basic Income to kick in. It’s coming.
TL;DR: Expect to see many insurance offerings (at first from new companies) that bypass agents altogether.