E-Distributing: WellPoint uses technology to enhance the online experience for consumers and help agents move business to the Internet.

Health plans can use technology in critical ways to build stronger relationships with distribution partners, according to Alan Katz, senior vice president of strategic distribution for WellPoint Inc. Katz will address several of these methods during the "E-Distribution: 2006" presentation at A.M. Best Co.'s E-Fusion insurance and technology conference in Philadelphia.

Carriers continue to seek new ways to leverage technology for more effective distribution, and strengthening agents' ability to use new distribution channels is an essential piece of the puzzle. WellPoint knows that challenge first hand. Over the past several years, the company created several technologies to enhance distribution, including its AgentConnect that allows agents to link their Web sites with the company's site and co-brand its sales tools as part of their site.

Katz coined the phrase "many doors, one destination" to describe the strategy of putting consumers in control of the way they buy health insurance. "Consumers are more likely to buy if they are comfortable with the way they're buying. So we don't tilt the playing field to drive them in a direction that might be uncomfortable for them," he said. This means, regardless of what channel a consumer uses, WellPoint offers them the same products and the same underwriting at the same price, he said.

WellPoint also is helping agents move online. "Every day it's becoming easier for traditional agents to establish themselves as an online agent or e-agency," Katz said. "Vendors are doing a good job of helping agents move their business onto the Web with easy-to-maintain Web sites and quoting systems. Over time, we're seeing e-agents, in aggregate, become a greater share of overall sales. "The benefit when traditional agents go online? They provide a very personalized service, he added.

Katz said the "sweet spot will be striking a balance between the high-tech and high-touch"

Among e-distribution methods beginning to make their way into the industry are online chat and instant messaging. Other methods such as video conferencing technology, however, aren't seeing widespread use among agents or consumers.

Technologies that work best are those that meet a need, Katz said. "With distribution, especially with independent agents and individual and small group purchasers, a carrier can spend a lot of effort on new technologies, but unless it makes agents' or consumers' lives easier, it won't work," he said. "Being different for different's sake is a losing strategy."

Katz believes e-distribution also will have an impact on both health savings accounts and the small group market. In the small group market, for instance, he said it will become easier for business owners to shop online and then find a local agent to help them through the actual sales process. "There are a lot of people trying to discover the Holy Graft of end-to-end online sales in the small group market, but I'm not optimistic there is such a thing. There are dynamics in the market that make it particularly challenging." When consumers make purchasing decisions on their own behalf and that of their families, they're willing to buy online, he said, but when making decisions on behalf of colleagues' and employees' families, they want to work with an agent with the expertise to walk them through the issues and ensure they're making the right decisions.

Speaker Spotlight

Alan Katz

Senior Vice President of Strategic Distribution

WellPoint Inc.

"E-Distribution: 2006"

Philadelphia

Oct. 17-18, 2005

www.efusion2005.com