While the unveiling of insurance company Web sites in Europe has generally trailed that of their U.S. counterparts, the European firms' venturing onto the Web today are unveiling transactional and service innovations that sometimes surpass the capabilities of their U.S. counterparts. Some British and European insurers are investing heavily in online sales and services, positioning themselves for the time when many insurance products will be commodity products.

European insurers have started later than American ones in developing their Web sites; but they have the advantage of being able to learn from other insurers' earliest efforts on the Web. Impressed by the American model for the use of the Web, European insurers are already dedicating large budgets to move online with state-of-the-art technology and new business models. Although life insurance sales on the Web remain a challenge, Web-based customer service and premium processing is already helping some European life insurers trim their operating costs. In general, European insurers lag behind online banks, but are striving to catch up. They are finding ways to simplify the online selling process and to service claims at sites that rival those of American companies.

One insurer that is already moving ahead with innovative Internet sales and processing is the Amsterdam-based Ineas Insurance Company (www.ineas.com), which has Dutch, German, Belgian, French and English sites aimed at its multi-cultural customer base. Ineas offers personal insurance, such as home, car, accident and liability products, using the Web as its sole distribution channel. This is an approach that has existed in the United States for some time; but Ineas also offers risk management advice via the Web, such as providing an online "personal risk calculator". Another innovation Ineas offers is online file management. Ineas allows a consumer to keep all of his insurance documents in an online storage space - even those of other companies. Insurance involves so many documents that consumers tend to misplace them, so this is a nice idea. Another area in which European insurers have been able to innovate is online sales. For certain products, some countries in Europe have simplified the regulatory environment, making online sales easier. For example, in the U.K., it is no longer necessary to obtain a client signature to sell automobile insurance. A customer can fill out an application online, where it can be approved almost immediately. The purchase can be made with a credit card. Similar rules govern auto insurance in Holland and Scandinavia.

Life insurance is an area that is difficult to sell online, but it has become possible to sell investment-related life products like annuities online in the U.K. Several bankassurers are already working in this area. Insurers are also thinking more broadly about how using the Web can improve the efficiency of claims processing. Online claims handling is saving British insurers considerable sums - simply by contacting customers via e-mail instead of the telephone, the savings are important. Clients can already service their own claims, learning how far along a claim has come or and when they can expect a reply, without contacting call center employees. Another development, which European insurers are likely to explore, is the 'supermarket' approach in which a site offers personal line policies from a number of carriers.