The insurance industry has been hit hard lately. And unlike Dorothy in Oz, they can’t click their ruby red slippers to make it all go away. Natural disasters such as wildfires, hurricanes, tornadoes, and other weather-related damage have led to more, and costlier, home insurance claims. After working from home and having almost everything we needed delivered to our door, many of us seem to have forgotten how to drive, leading to more collisions. And auto thefts are on the rise, with more than one million vehicles reported stolen in 2022.
Insurance companies have paid the price. Home and auto repair costs have risen dramatically and are taking longer due to parts and materials shortages caused by supply chain issues, labor shortages, and the reduced supply of new and used replacement vehicles.
As claims have risen, so have premiums, causing many consumers to start shopping for insurance even as some major carriers have reduced ad spend. With so many factors at play, it’s never been more important to ensure that your lead generation efforts are maximizing your marketing dollars and delivering quality leads.
What Factors Are Leading to Insurance Carrier Challenges and Opportunities?
Insurance policies are issued for many areas, and they all face their own unique challenges and opportunities which can impact their marketing and lead generation activities.
For this discussion, we’ll focus on consumer property and casualty insurance, specifically home and auto.
Home Insurance Overview
Premiums are on the rise, with an average nine percent increase in 2023. Property rebuilding and replacement costs, which account for 97 percent of claims filed, rose 55 percent between 2019 and 2022. To avoid paying out costly claims, carriers are pulling out of some states that have seen an increase in property claims due to weather-related incidents, lessening the number of prospects.
Auto Insurance Overview
Post-pandemic, drivers are back on the roads and back up to speed. This has led to more, and more severe, collisions. More collisions, combined with rising parts, repair and replacement costs, have cause premiums to rise, which means more drivers are shopping for lower premiums. One survey revealed nearly half of respondents switched auto insurance carriers in the past year.
While these issues are presenting current challenges for the insurance industry, one issue that remains constant is lead generation fraud. Weather, supply chain issues, and rising costs are out of a carrier’s control, but there is plenty that can be done to lessen lead generation fraud and improve the quality of leads that are coming into the pipeline.
Use Slower Lead Volume to Your Long-Term Advantage
If you’re spending less on advertising and lead generation, you’ve probably got some time on your hands to review your lead generation process and make sure the leads you are getting are worth the money and effort.
Start by identifying your best traffic source(s)
Don’t assume it’s the one that generates the most leads; after all, quality is better than quantity.
Look at the partners you have in place to help vet your leads before they make it to an insurance rep or call center.
Partner with an ad fraud solution
An ad fraud solution is the first line of defense because they can identify who is behind the keyboard.
Ad fraud is binary: it comes from either a bot or a human. Bots are easy to detect and stop. Humans are more challenging to detect because they act, well, like humans. One human, as part of a human click farm, can generate multiple fake leads by using tactics such as IP address spoofing and device spoofing to make it seem as if leads are coming from several individuals.
Next partner with an Integration platform
Once your ad fraud solution has stopped the flow of non-human traffic, as well as fake leads from humans who have no real interest in your insurance offerings, the next line of defense is an integration platform that can help manage your leads in one place. The right platform can also add other filters for all your lead sources, such as verifying the asset that is to be insured, actual replacement values, current coverage, and more.
Check your compliance
This is also a good time to make sure your marketing complies with all relevant regulations and that your prospects are giving explicit consent to be contacted. The right partner will keep up with changing regulations, which can help protect you from fines and other penalties.
It’s easy to assume that if marketing activities and incoming leads are slowing down that there would be less fraud, but that is not the case. At best, fraud remains steady at an average rate of 25 percent. For at least one carrier that pulled back on ad spend, Anura detected an increase in fraud.
How Can an Ad Fraud Solution Prevent Fines and Ensure Quality Leads?
Insurance is a relationship business, and like many relationships, they often begin online. You have no idea who (or what) is behind the keyboard, if they’re really interested in your insurance products, or if they’re out to make a quick buck at your expense. That’s why it’s so important to screen out bad actors and bad leads before you buy them or contact them.
An ad fraud solution provides the first line of defense in protecting your ad budget and your brand reputation. It can also help keep you in compliance with TCPA regulations and prevent expensive non-compliance fines.
How does ad fraud lead to TCPA violations?
When real contact information is provided by a human fraud farm and the person named on the form is contacted, that’s a TCPA violation, even if there is confirmation of consent. Why? Because the person who gave consent was not the person whose information was entered. Their personal information was likely stolen and used to create lead generation fraud.
Now, consider that the lead information was probably sold to at least five carriers. Each of those carriers calls the prospect up to 10 times. That’s 50 calls the consumer is getting in just a few days. In a best case scenario, the prospect simply doesn’t answer because they don’t recognize the number and are not expecting the call. Even so, your contact center has wasted time chasing fake leads. If the “prospect” does answer, you’ve committed a TCPA violation and are now subject to fines.
What are the consequences?
The consequences of not complying with TCPA regulations can lead to class action lawsuits which can be costly for your company. In 2022, Allstate paid $4.5 million—more than $600 per class member—for unwanted calls.
An ad fraud solution can detect and stop invalid traffic before it gets to your lead form. This not only protects you from expensive fines, but it also improves your lead quality and reduces wasted ad dollars.
Anura’s lead generation fraud solution is agnostic to the type of insurance. Whether you offer auto and home, health and life, or commercial insurance, we can help you eliminate lead fraud, improve your sales and marketing results—and prevent fines!
It all starts with finding out how much fraud you have today, and we can show you with a free 15-day trial!