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Uncertainty may hurt most advertisers but not insurance companies, and their marketing efforts continue to perk along despite the weak economic recovery.

The insurance sector generated $1.48 billion in measured spending last year, up 5%, according to TNS Media Intelligence/CMR. Among the 20 insurance companies with spending above $10 million, six showed declines. Allstate Corp. alone grew 135% to $104 million in media.

The Internet has changed the way people shop for insurance, says Jonathan Knowles, senior VP of consultancy BrandEconomics, a joint venture of Stern Stewart & Co. and WPP Group's Young & Rubicam. "People start with the cheapest until they hit the only one they've heard of," says Mr. Knowles.

At the same time, the number of competitors has increased dramatically as the regulations that kept banks, brokers and insurers apart have been relaxed.

"You have banks that want to be in the insurance business, brokerages that want to be in the insurance business and insurance companies that want to be in the financial services business," says John Hildenbiddle, senior VP-brand management and public relations at Mutual of Omaha. When Mutual of Omaha hired a market researcher recently to survey the insurance market, researchers were amazed at the sheer number of competitors, says Mr. Hildenbiddle.

"They had never seen a [product] category as crowded as this except for candy," says Mr. Hildenbiddle, whose company increased its measured spending by 174% to $21.6 million in 2002.


That clutter means insurers need memorable advertising to break through, says Victor Lipman, VP at MassMutual Financial Group. "There's a lot of unpredictability in life and, in a changing world, what we help you do is achieve financial success," says Mr. Lipman.

Last year's stock market's downdraft has added another dimension to that focus on insurance. After years of taking a back seat to a hot stock tip, annuities are again popular among investors seeking a safe haven, notes Steve Crane, president-creative director of Cossette Post, New York. Insurance "has always been seen as a conservative investments," he says, "and there's Middle America looking at their portfolios."

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