Australia is one of the leading countries for direct life insurance sales, according to Oliver Wyman Principal Brad Clarke.

“Direct sales channels are advanced in Australia and are now accounting for about 25% of new business,” he told an Actuaries Institute forum in Melbourne.

“Australia, South Africa, the UK and Germany are now the leading direct life insurance markets.”

Mr Clarke says insurers with direct operations have clashed with the intermediary channels in the past, but “people are now accepting the growth of direct”.

“In Australia you don’t have to be an insurer to sell insurance, you just need an advertising campaign,” he said. “Australia has developed a number of direct sales models including latent marketing and cross-selling.”

Mr Clarke says companies such as InsuranceLine and Real Insurance are using the latent demand model, while the big banks are using their databases to cross-sell.

There have also been cross-sell partnerships with organisations such as NIB Health Fund and Woolworths.

The direct distribution channel has also evolved into using active customer pull techniques, Mr Clarke says, with Allianz and iSelect as examples.

“Another interesting trend is the way people are interacting with the various distribution channels,” he said.

“They start their research on the internet, but they use this channel less to conclude the sale.”

Mr Clarke says customers who use the internet end up at the call centre or an adviser to finalise the sale.

“The key to success is managing multichannel conflicts, while doing something different,” he said.