Online sales of insurance products are nothing new. However, for life and health insurance, progress has been slow in Canada, and faces many challenges—both technological and human—according to the speakers who took part in the panel entitled Online Insurance Sales: Sustainable Growth or a Flash in the Pan?, held in Montreal on November 18 during the Congrès de l'assurance de personnes (Life and Health Insurance Congress).
“When we think about online sales, there are many financial institutions that are not life insurers and that are nonetheless fairly successful. So, it’s worth looking at what others are doing to try to understand how we can improve by drawing inspiration from them,” noted moderator Louis Regimbal, Senior Advisor at Oliver Wyman, during the event organized by the Insurance Journal Publishing Group.
The American example of Zinnia
Ian Jeffrey, Head of Partnerships and Canada Director at Zinnia, a U.S.-based insurance product design and distribution platform, then described the success and the formula behind his employer’s online sales during a video presentation.
“One of the mistakes Canadian insurers or distributors make is thinking that we can replicate online exactly what happens in everyday life,” he said. “The reality is that online, it’s not the same context as when I’m speaking with my uncle or a friend with whom I already have an existing relationship.”
He recounts that at the time he was working for Breathe Life, the objective was online sales. They offered a hybrid model where the consumer started online and was then connected with a financial advisor. Most of the time, the sale was finalized with that advisor. Fewer than 5% of online sales were completed without speaking to a human being.
Things have changed very significantly since then, Jeffrey emphasized. Today, Zinnia owns a marketplace, Policygenius, which brings together 24 different insurers. According to Ian Jeffrey, it is the largest distributor of online term life insurance products in the United States.
When Zinnia acquired Policygenius, 100% of sales were completed with the help of an advisor, he noted. Today, nearly 15% of policies are sold without any human intervention.
The Policygenius formula
“The machine has seen so much volume that it’s able to say: ‘based on the information Louis entered online, he needs to interact with a human being.’ An advisor will then take the call and work with him to complete the sale,” Jeffrey explained. He specified that the 150 financial advisors who work for Zinnia do nothing but sell on what he describes as the marketplace.
But if the machine, based on the information the insured entered into the system themselves, determines that they do not need to speak with a person, they will then be directed to a self-serve journey.
“The machine is intelligent,” Ian Jeffrey summed up. “It knows exactly where to route [the lead] based on the profile it has been able to build of the customer who is in the process. But it took an incredible amount of volume and 12 years before it worked and before it was able to accurately predict where [the lead] should go.”
A Canadian version
But how can the same model be replicated in Canada, a market that is much smaller than the United States?
What we see here in Canada, Ian Jeffrey observes, is that insurers and distributors are trying to do it themselves.
“However, there is a much greater chance of success if all insurers are together on the marketplace and the machine says: ‘not only does Louis want to be assisted by a human being, but based on what we know about him, we should [match him with] a product from iA or Assumption Life,’” he illustrated.
The challenge is significant for the Canadian market, Jeffrey believes. For it to work, there must be many insurers so that there are many opportunities, as well as a lot of volume in order to understand how the consumer will make their purchase.
Everyone must play their role
Our insurance industry, Ian Jeffrey says, believes it can do everything in addition to manufacturing policies—both building technology and generating online leads.
“Your core competencies are building insurance products or, as a distributor, distributing offline. That’s what you’re best at,” he said.
“Everyone must play their role,” Jeffrey continued, addressing those in attendance directly. “It’s fine to work together, and that’s how we’re going to get the best results.” He instead invites insurers and distributors to work with an advertising agency or a company like Zinnia that is capable of lead generation or of building software. But to do so, everyone must respect their role, he believes; “that’s how you can succeed.”
Zinnia, he specified, has no intention of importing Policygenius into the Canadian market. However, the technology could be made available to Canadian insurers and distributors who would like to use it.
Insurers must focus on their role
One of the panellists, Valérie Le Roux, Vice-President, Products and Partnerships at Humania Assurance, said she agreed with him.
“Roles are absolutely critical. As an insurance company, we are manufacturers; we must not think or assume that we know how distribution works,” she noted. “Insurers must focus on their role and work, as Ian [Jeffrey] was saying, with distributors who will bring us their models and the best way to distribute our products.”
We must “reach new generations” and adapt distribution based on communities with different models, added Le Roux, which is what Humania aims to do. According to her, people inform themselves through artificial intelligence (AI) and online searches far more than through direct contact, as was the case in the past.
Platforms that make the process simpler and easier will attract the next generations, she expects. At the same time, they will allow brokers to work differently and to generate more volume without necessarily being present throughout the entire process.
Being part of an ecosystem
The other panellist, Pierre Martin, Associate Vice-President, Partnerships, and Chief Digital Officer at Assumption Life, shared their view.
“We’re part of an equation; we have to collaborate,” he commented.
Achieving an 8% online conversion rate is very high, he said; “15%, as Policygenius achieves, is excellent.” In his view, being able to operate as an ecosystem to get there would be “fantastic.”
The insurer, based in Moncton, New Brunswick, has its own insurance distribution platform: Lavvi. It is an entity that is “completely separate” and that any other insurer could use if they wished.
Founded under the name TKS in 2007, Lavvi is led by Roddy Awad, who serves as its President and Chief Executive Officer. On December 16, 2024, the Insurance Portal reported remarks he made at the same event in 2024.
For Lavvi to move toward a model closer to that of Policygenius, Pierre Martin believes that intermediaries would be needed—more advanced digital systems providers. An ecosystem is developing. It is slow, he observes, but it is moving forward. He is looking forward to seeing what it will look like in five or ten years.
