The market environment is further improving. In terms of policies, the "State Council Suggestions on the Reform and Development of the Insurance Industry," "Guidelines for the Eleventh Five-Year Plan for the Development of the Insurance Industry in China," and "Key IT Application Project Plans in the Eleventh Five-Year Plan for the Insurance Industry in China" were released. Promoting e-commerce became a key objective for developing the insurance industry during the Eleventh Five-Year Plan. Technologically speaking, regulations such as the Law on Electronic Signatures, Guidelines on Electronic Payments and Administration of Certification of Electronic Services went into effect.
In this way, issues such as identification, electronic policy and online payment, that had previously restricted e-commerce, were improved, providing positive technical environments for the development of insurance e-commerce. In terms of market demands, with the push of insurance companies and insurance agents, customers had increased awareness of online consulting and online purchases. Online revenue from premiums increased to nearly 2% of the overall premium revenue in 2006, compared with less than 1% prior to 2005.
Insurance companies' own portals are the major application models of insurance e-commerce in China. Since the end of the 20th century, China's insurance e-commerce has undergone the pressure from insurance companies' building websites and third- party agents opening websites. However, up until now, the major application model remained the insurance companies' own portals. All mainstream insurance companies have built their own portals and conducted online promotion, online consulting, online sales, online payment and online customer service, and to a greater or less extent have created e-commerce platforms. Among them, 95519 of China Life, Taikang Online of Taikang Life and PA18 of Ping An Insurance are outstanding in fame and practicality.
Due to immature market demands and the limited supply of products, portals built by third-party insurance agents in the early craze of insurance e- commerce have mostly converted to specialized insurance information platforms or insurance e-commerce software and solutions providers, promoting the development of this segment from a different perspective.
The e-commerce department of insurance companies lack autonomy.
As it stands, all major insurance companies have their own portals, whose functions have developed from monotonous product displays and brand promotion to collecting customer intentions, online purchases and online consulting. Unfortunately, it is common for most e-commerce departments in insurance companies to take on additional sales responsibilities and to lack autonomy. As a result, product development, sales models, and service models of the companies have not been adjusted in accordance with the features of e-commerce, leading to low efficiency.
The intra-information system of insurance companies does not connect well with e-commerce, hindering the latter's development. E-commerce, which is essential in allowing insurance companies to explore new markets in the Internet era, enables the companies to provide 24/7 service to the customers. However, only if the company's core business system is organically integrated with the Internet portal, can the company truly reduce operation and sales costs and raise efficiency. Hence the e-commerce levels of insurance companies are closely related to the internal information management and resource coordination of the companies. At present, difficult connections between e-commerce portals and the internal information system of the companies are becoming more and more obvious with the further development of e-commerce. System building in some companies severely restricted the development of e-commerce.
Although e-commerce portals collected customer intentions and even purchase information, back-stage service systems cannot process this information quickly and representatives still have to reply through phone calls and even personal visits, greatly lowering the efficiency of e-commerce. Lack of efficient and continuous processing procedures, and failure to react rapidly to customer's initial consulting queries, harm the image of the company to a very large extent.
Despite these problems and difficulties, at a time when better policies are being advocated, and technological and market demands are high, development of the insurance industry should be properly coordinated and planned, as CCID Consulting believes. First, set specific goals for each phase of online promotion, online consulting, online purchasing, electronic policy and electronic payment, in that order. Second, define the responsibilities of e-commerce departments, improve work procedures, coordinate corporate resources for e-commerce and do not treat e-commerce departments as a mere executive department of sales. Third, integrate e-commerce portals effectively with the company's internal information system. Last but not least, create a scientific evaluation system of e-commerce to comprehensively assess the performance of e-commerce, and at the same time, focus on sales goals, cost- saving goals, efficiency improvement goals and customer experience goals.
