Online trend bodes well for iSelect

Latest research shows more and more people are comfortable buying their insurance online.

a woman

Recent finding by market research house Roy Morgan showing “that 49.6% of the population with insurance (up 1.5% from the previous year) now identify the internet as the media most useful for selecting insurance stocks” would appear to be good news for a number of companies heavily exposed to this means of selecting insurance products.

Front and centre is the recently listed comparison website iSelect (ASX: ISU), which provides a medium for consumers to compare and select many products, including insurance products. A number of the newer entrants into the insurance space are also using the power of the internet to grow their direct-to-consumer offers as well.

Wesfarmers (ASX: WES) and Woolworths (ASX: WOW) both offer direct internet applications respectively under their Coles and Woolworths branded insurance products, and insurer NIB Holdings (ASX: NHF) also uses online marketing and sales as an important avenue to grow its customer base and stands to gain from this consumer trend continuing.

In commenting about the findings, Industry Communications Director for Roy Morgan Research, Mr Norman Morris stated:

“Clearly the importance of the internet as a channel to research and purchase insurance products has moved beyond the early adoption phase. The vast majority of the population are now using the internet on a daily basis, spending more and more time online and becoming more comfortable conducting financial transactions via the web.”

Morris went on to say that:

“With the growth of the online comparisons and the relative ease with which policies can now be researched, understood and taken up; insurance providers who are slow to invest in optimising their digital presence and understanding how and where to create effective customer engagement through the internet and social media, risk losing touch with an ever-growing proportion of the market.”

It appears directors of iSelect would agree with Mr Morris on the positive outlook for online insurance sales. With the share price having fallen to its current level of $1.35 – well below its initial public offering price – most directors have entered the market to purchase iSelect stock.

Foolish takeaway

While it is of course encouraging to see directors buying stock in iSelect, arguably the company still trades on a hefty earnings multiple despite its recent share price falls. Identifying industry tailwinds is useful when considering investing in a company but not overpaying for the stock is still critically important.

Solid dividend-paying stocks can be like a form of insurance for your portfolio. Discover The Motley Fool’s favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of “The Motley Fool’s Top Dividend Stock for 2013-2014.”

More reading


Motley Fool contributor Tim McArthur owns shares in NIB Holdings.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of January 12th 2022

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

person reading news on mobile phone
⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »