Monthly Archives: April 2011

The Regulators Are Coming!

Regulatory oversightIt was only a matter of time before state insurance regulators began to get a handle on if or how to regulate social media.   The “if” question has been answered   As many as ten or more states have begun to monitor the social media activity of insurers and that number is predicted to grow to at least half by the end of the year.

The “how’ is a bit trickier.  What these regulators appear to be looking for is evidence that an insurer has a formal social media policy and a training program to make sure the program will be compliant.  At this point, the issues that raise the most concern for regulators include misleading advertising, the use of testimonials and endorsements (is an endorser being compensated?), consumer privacy, records retention (are posts retrievable?), and agent monitoring (are companies paying attention to what agents are posting?)

Social media success depends on two-way conversations that are spontaneous and sincere, not stiff and scripted.  Regulators want to make sure, however, that what is discussed on social media sites is accurate and mirrors the information they collect from the insurer.

Bottom line:  Companies can no longer put off the task of developing a social media policy and making sure their employees and agents understand it.

Rising Above the Chatter

Above the ChatterInsurance executives take one look at the many conversations taking place on social media sites and cringe. Celebrity cults, hyper-ventilated screaming and self-important gibberish is part and parcel of the social media landscape. But so is real dialogue about real problems, substantive brand-building and a growing understanding about how our industry can and does work.

“Why should I want to tell anyone what I had for breakfast today, let alone find out what someone else had?” is a common question.  Fair enough, but that’s not the right question to ask.  A better question is:  ”How could any insurer or producer use a mass communications tool that enables real-time, two-way conversations with a defined audience?”

The insurers and producers that embrace social media and truly listen and engage can rise above the chatter.  Those who can be empathetic, reasoned and timely in their conversations will separate themselves from those who choose to rant about, minimize or ignore discussions about topics related to insurance.  Those who reach out to the online world, not to pitch but to learn as well as guide and educate will create advocates for their brands — people who will promote more effectively than the best advertising.  Those who can develop an authentic, upbeat, unscripted voice will make human connections with policyholders and prospects that no hard-sell can match.

Stop Calling Social Media “New”

Nothing new under the SunSocial media is not a new-fangled technological concept but a throwback to the days of the small town merchant of fifty or one hundred years ago, if not longer.   In those neighborhoods or small towns, everyone knew each other. The local storeowner knew what customers wanted and needed because he or she was one of them. An unhappy customer could complain face–to-face with the owner. Whether happy or not, customers could and would tell their friends and neighbors about the storeowner, the products and the service.

As our society became more prosperous and people ventured farther and farther outside of their towns, businesses grew larger and more impersonal and systems and processes more institutionalized.

Newspapers, telephone, direct mail, radio, and television provided these businesses the means to reach many consumers at once through advertising, catalogs, and news events.  On the flip side, though, consumers were not as able to communicate as easily.  Apart from surveys and focus groups, the dialogue was largely one-sided.

Social media reverses this long trend toward increasingly faceless institutions.  In this global, high-intensity, time-starved, technological marketplace in which all insurers must operate, social media facilitates more of the personal, immediate, human interaction consumers crave from the businesses they choose to patronize.  The insurers and producers that can best deliver that interaction will prosper. The ones who can’t or won’t will eventually disappear.