Online insurance supermarkets — independent agencies offering the products of multiple underwriters on the Web— are targeting banks and brokerages to reach a wider market, as observers say they must do to succeed.

In the banking world, the online banks are leading the way. NetBank Inc. of Alpharetta, Ga., and Juniper Bank of Wilmington, Del., a unit of Synovus Financial Corp., have both entered into such alliances — NetBank with and Juniper with Answer Financial of Encino, Calif.

The online supermarkets work with banks in several ways.

Some just provide a link to an existing Web site that sells insurance. and InsWeb flaunt their own brand names but when teaming up with a bank will set up a Web site using the bank’s name too. And, Financial Keyosk, Inslogic, and Coverage Corp. work completely behind the scenes, creating a site branded in the bank’s name.

The financial details of the agreements also vary widely. Some banks are paid for customers that buy insurance on their partners’ site, while other banks pay the outside companies to build insurance functions on their Web sites.

Web-based banks are an obvious starting point for the online agencies, said Thomas O’Donnell, director of products at Juniper Bank. “Because of the relationships we build with our customers, there is a heavy level of online interaction, and a higher probability that those same people will be comfortable looking for other financial services products online.”

Banks are also the entry point for online financial transactions of all kinds, he added, because consumers consider banking to be a daily activity, and already do some electronic banking through the telephone and ATMs. As banking sites get frequent traffic, they can be a good portal for other transactions.

“People buy insurance periodically,” Mr. O’Donnell said. A retail site devoted to insurance is “not going to have the kind of frequency of visits a banking site would get. We have an opportunity to present these products to people on a daily basis.”

Juniper decided to work with an insurance supermarket to provide a wider range of products, Mr. O’Donnell said. “You may be a great banking customer, but you may be a lousy driver,” he said. “We still want you, as one of our customers, to be able to find insurance.”

NetBank sees its ability to offer a range of insurance products as a step toward becoming “a one-stop financial shop,” said Michael R. Fitzgerald, its president. Many other banks, he said, are waiting to see which online insurance players survive the fluctuating stock market and decreasing venture capital base for dot-coms.

Eventually, he said, insurance will become a huge component of online banking, because customers want it. “It’s an emerging customer demand, as more customers come online and start finding ways to use this technology to shop for financial services,” he said. “The demand is eventually going to drive the supply.”

All of the online agencies are currently seeking partnerships with brick-and-mortar banks, but few deals have emerged. Inslogic works with PNC Bank, Key Bank, and National City Bank., owned by First Union Corp., now works only through First Union but wants alliances with other banks.

But according to David Potterton, research director for e-financial services at Meridien Research, online insurance agencies are held back by the insurers themselves, which have been slow to go online and allow customers to complete purchases over the Internet.

Meanwhile, “many banks and other financial institutions are looking to partner with people who can provide this technology,” he said.

For the online agencies, success will depend on the quality of their technology and the products they have to offer, not on their branding strategy, he said. “When you partner with a bank, you are really counting on their brand to see you through,” he said.

The main challenge for these agencies is achieving a “critical mass” of insurers that will complete the insurance transaction on the Web, said Todd Eyler, a senior analyst with Forrester Research in Cambridge, Mass., who follows the online insurance market.

“The average consumer should be able to get at least five competitive quotes” when putting information into online agency’s Web site, he said. “Right now they probably get about two to three.”

While most online agencies are actively looking for bank partners, many banks are taking a wait-and-see attitude, said Louis Geremia, president of the online agency “There’s no question that they’re very keen on having an online insurance offering,” he said. However, “it’s taking time — they’re trying to assess how they want to offer insurance online.”

And many banks already have relationships with offline agencies, which they may not want to abandon, Mr. Geremia said. Also, he added, before committing to a partnership, banks are waiting to see which companies survive.

Mr. Eyler of Forrester Research said the online agencies need to work with financial services Web sites that have more frequent contact with consumers. “People shop for auto insurance, at best, once every six months, and other products more like once every few years,” he said. “Given the infrequency of the contact, you really need to be working with a bank or brokerage site.”

Mr. Potterton added that the online model will work only for some products, such as auto insurance and term life. “It remains to be seen how much of the more complex insurance policies actually get issued online,” he said.

Forrester’s Mr. Eyler said: “I think if we look out five years, 80% of people who are on the Web” will use online agencies to research or buy auto insurance.

These agencies have “a huge role to play,” he said, but “they have a long way to go to get to the point where they are actually useful for consumers.”

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