It’s no secret that I’ve been critical of insurance industry advertising here and on LinkedIn. This blog post last fall was triggered by a tweet featured in the daily insurtech newsletter Coverager:

Just recently, the daily Carrier Management newsletter included an article about a State Farm commercial touting the ‘genuineness’ of a real agent vs. an AI bot in response to some social media criticism of State Farm by insurtech Lemonade and others.

I posted the following on a LinkedIn discussion about the State Farm commercial:

What most insurtechs are selling beyond “hipness” is convenience centered on fast/easy/cheap. Lemonade has said they can book your homeowners insurance in 90 seconds. Hippo can do it in 60 seconds. Some insurtechs only have to ask 3 questions (and one is trying to narrow that down to 1 question). Another insurtech only needs a photo of your license plate to place your auto insurance.

No one can place your homeowners insurance in a minute and do the job properly. Not even “big data” can save them given the inaccuracies and unreliability of much of the public information available. “Insurance” is not a single transaction. The “customer experience” does not begin and end with a phone app.

The insurance process includes assisting people in identifying their exposures to loss, properly and adequately insuring them (or suggesting alternative risk management techniques), then, if necessary, advocating on their behalf if a claim is improperly handled. Insurtechs, in their question for fast/easy/cheap are not offering this, leaving potentially millions of consumers exposed to financial ruin, not to mention the emotional consequences that their AI bots are incapable of understanding and the humans involved seemingly don’t care about.

A bot can’t do this because it’s little more than a tool. I do a presentation called “The Reports of My Death Have Been Greatly Exaggerated: Commoditization, Disruption, and the Imminent Death of the Insurance Agent” (a viewpoint you’ll likely never see presented at an insurtech conference). I’ve been hearing about the death of agents since the 1970s. Someone told me recently that his father made a presentation on this subject in 1958. So far, perhaps the only thing more enduring than agents are the naysayers.

The complaint I’d have about the State Farm commercial is expressed in my blog post from last fall. Why does the vast majority of insurance advertising focus on being funny? I understand that you want a TV commercial that gets the audience’s attention and is memorable, but does it have to attempt to be silly or hilarious to do that?

Our industry exists to assist individuals, families, and organizations in identifying and insuring their loss exposures in order to minimize the chance of serious or catastrophic financial loss and the emotional toll that entails. What’s funny about that?

It’s alleged that the single most effective TV commercial of all time is the Mothers Day commercial that featured Alabama football coach Bear Bryant, and a testament to its effectiveness is that I still vividly remember the commercial. If you can spare 30 seconds, take a look at it:

https://www.youtube.com/watch?v=debUgKSutN4

Allegedly, this brought down South Central Bell’s entire telephone system. That’s the potential impact of touching people emotionally and humor is just one way to do it. There are better ways, ways that demonstrate the importance of our industry, who we are, what we do, and why we do it.

 


Note:  There is a chance my blogging might be a little sparse during the month of March. Perhaps too much time reading policy forms and sitting in front of a PC monitor has created the need for some eye surgery in the coming month. The recovery may not inhibit my blogging, but just in case, I wanted you to know that any absence was temporary.

Also, do not forget that March is Ethics Awareness Month in the insurance industry!

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Bill Wilson

Founder at InsuranceCommentary.com
One of the premier insurance educators in America on form, coverage, and technical issues; Founder and director of the Big “I” Virtual University; Retired Assoc. VP of Education and Research from Independent Insurance Agents & Brokers of America. Reprint Request Information