In July 2010, Facebook announced that it had more than 500 million users. Far from being a passing fad, social media and social networking are here to stay. But what are the implications of social media on the insurance industry?

Implications of social media on the insurance industry

Even though insurance is a mature industry, it is a trust-driven industry. It is driven by the trust in a customer-advisor relationship. This is a natural fit with social media, where winning brands are those that develop a relationship with their customers. Not only do customers talk about these relationships publicly, but word of mouth reaches new customers—along with the original customer’s stamp of approval.

Social media also provides insurers with a way to stay top of mind with their customers. Most customers only think about insurance when they experience a significant change in their life, change their address or renew a policy. Social media provides a channel through which customers can be reminded of the value that insurers bring to everyday life.

Five ways that social media can benefit the insurance industry

Accenture sees five ways that social media can benefit the industry:

  • Dramatically decreasing the cost of establishing and developing a new brand.
  • Changing the customer experience to support channel integration and personalization.
  • Innovating product development.
  • Increasing effectiveness of recruitment, training and skills development.
  • Enhancing operating models with improvements to communication and collaboration.

Accenture has developed a Point of View on this topic. Download Achieving High Performance in Insurance through Social Media (pdf).

Join me over the next two weeks as I talk about this in more detail. Next week, I’ll address some of the unique challenges that the insurance industry faces with using social media.

Does your business use social media? What benefits have you realized as a result?

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