The growing use of Web portals by agents and customers to perform transactions previously done inside companies is having a profound impact on organizations. These technologies are making it easier to quote, submit new business, change policies, and they are shrinking service cycle times. However, while this helps customers and agents get things done when and how they want, there is the potential paradox of making things harder inside insurance companies. Here's why:

Work is more complex and less routine. Agents and customers can complete the self-service transactions as long as they fit the norm. When the transactions become complicated, underwriting, customer service, or the call center has to get involved. Much of the remaining work for the internal staff is more complex and less routine. To address this, companies will need to rethink how they select, train, and develop people for customer service positions. Minimum education levels and scores on aptitude tests will have to be re-evaluated along with salary levels as "clerical work" disappears.

The design of the portal and interfaces is the new field of competition. The abstract nature of insurance is coming alive in the form of Web-based processes. As customers rely on these systems more (and almost 100% of companies surveyed say they are working on them), insurance companies will be judged on how easy their portals are to use. Agents already say that ease-of-use greatly influences their placement decision. As customers gain more exposure to these systems, their decision to renew or switch to another carrier will also be influenced in the more commoditized lines of personal insurance. Companies must approach the design of their portals much like they approach the design of their processes; more so because customers themselves are using those processes. The scope of these designs must go beyond the underlying technology. They must be easy, intuitive, and fully supported on the back end. It will be important also to elicit continuous feedback from customers and agents so the designs can be continuously improved.

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