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04:10 PM
Kathy Burger
Kathy Burger
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The Buzz About Linden Lab’s Second Life Raises Possibilities for Insurance Companies

The media buzz about Linden Lab's Second Life online digital world raises commerce and customer possibilities for insurance companies and other financial institutions.

A Insurance & Technology we are conditioned to avoid getting swept up in hype about the latest and greatest technology. But it's been impossible to ignore the buzz about Second Life, the high-profile "3D online digital world imagined, created and owned by its residents" (its own description). Talk about viral marketing! Suddenly, I can't avoid reading and hearing about this virtual world. Media outlets ranging from I&T sibling publications InformationWeek and Optimize to CNN and Fortune all have reported recently on the growth of Second Life, developed by San Francisco-based Linden Lab, and how the "game" is gaining more participants -- and also starting to work its way into the corporate world.

While right now Second Life primarily may give participants a chance to play out various fantasies (use your imaginations), it's also being explored as a possible way to enhance collaboration and creativity. For example, major players in the technology world, including Sun Microsystems and IBM, are tapping into Second Life as a medium for training, meetings and corporate presentations. Furthermore, commerce, including payments, occurs in the Second Life virtual world.

Disclosure: I am totally not an online gamer. I have no interest in computer games and barely even played Pac Man in its heyday. But in the interest of journalistic research, I just opened a Second Life account. So far, all I have done is create an identity (avatar) and select a Second Life name (Floradora Hitchcock -- in honor of my childhood parakeet and one of my favorite film directors); at press time, I hadn't actually downloaded the software yet (I was on deadline, after all.), but I'll keep you posted as I virtually reinvent myself.

Anyway, it's easy to start thinking of financial services transactions that could be carried out by avatars in the Second Life virtual world -- for example, an agent selling a life insurance policy to a young couple, or a broker and business executive hammering out a commercial lines contract. What would be the value of such virtual interactions? Apart from entertainment, it's hard to say -- today. But cultural, economic and demographic trends -- toward a younger, tech-savvy population that works remotely and relies on high-speed electronic communications -- make it clear that today's definition of a "typical" financial services interaction is likely to become obsolete before too long. It's not too early for insurers to get their virtual ducks (or avatars) in a row.

Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio

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