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The Rough Notes Company Inc.



May 31
08:42 2017


What, when, and how to use it

As a 40-year veteran of the insurance industry, it sometimes amuses me to reflect upon the “good old days,” when agency automation involved highly technical terms like typewriter, correction tape, and carbon paper. However, while automation has consumed our drive toward paperless processing, it has become a double-edged sword. Automation can certainly increase productivity; it also can consume enormous amounts of time, as service personnel attempt to master individual insurance company rating, underwriting, and risk submission systems.

In some respects, automation has resulted in agencies assuming duties previously borne by insurance companies. In fact, some insurance companies are utilizing automation to take the place of underwriters for accounts of a certain size. Initially, this sounds like an efficient way to conduct business, but when service personnel are shopping an account, the process of dealing with and completing multiple screens of information to obtain quotes from several different companies can consume their day.

The CSR who becomes astute at company underwriting guidelines, rates, and appetites will be able to adequately choose the best carrier for the risk, without having to approach several different companies. While this can be an extremely difficult task for the CSR working in an agency that represents several companies, knowing your marketplace is invaluable in achieving success.

An additional consideration is the wealth of economic factors that have led many agencies to place a greater focus on writing larger accounts. In fact, some agencies do not pay agent commissions on smaller commercial accounts or personal lines accounts as an incentive for producers to write larger accounts. Often, these agencies believe that paying commissions on smaller commercial lines accounts and personal lines is just not cost effective. Instead, responsibilities for this business have fallen to the CSR, who may sometimes earn a small commission for writing those accounts.

It is worthwhile to remember that the more some things change, the more other things remain the same. In my experience, with the exception of VIP clients, personal lines service personnel have always been responsible for the day-to-day work of completing the application, quoting the risk, and binding the coverage. What has changed is the manner in which business can be transacted by using automation. Learning the tips and tricks of effectively using the automation systems in your agency will pay huge dividends. However, this process is not always quick or easy.

Changes in requirements and methods

From a historical perspective, the time invested in writing a personal lines account has increased dramatically. We have gone from looking up a protection class and property value in a paper manual for a homeowners premium—which took about five minutes—to mapping a property for possible brush exposures, completing a replacement cost worksheet, completing an online submission, awaiting underwriting acceptance, and finally getting a quote. Depending on the risk, the complexities related to this process require significant expertise.

Not only do personal lines personnel need to be licensed, understand the coverages, know the differences among carriers, master communication skills to deal with all types of customer and prospect personality styles, and maintain a compatible and positive attitude, but they also must know and understand the automation systems necessary to quote risks with different companies and know how to use the agency’s operating systems.

Take another look at the previous paragraph, and you will understand why I say that today’s personal lines insurance book of business is profitable because of good, competitive insurance companies and knowledgeable personal lines service personnel. And a large component of that success is this: The automation sword has a side that slices through long wait times, data entry errors, and other issues, and ultimately results in enhanced bottom lines and better customer service—provided that customer service personnel know how to effectively use the available automation.

On the commercial side, the transformation has been even greater, as commercial lines service personnel have morphed into invaluable partners in the new business process. As automation has developed, commissions have decreased and bottom lines have been squeezed, which has resulted in producers being encouraged to “produce” and leave the underwriting and rating to service personnel. The producer brings in new business and the CSR handles the rest.

In many agencies, producers are no longer involved with an account once it has been written, or they may “touch” their accounts from time to time and become involved in the renewal process. In the final analysis, many producers have become dependent on their customer service partners because they do not understand their operating systems, do not have relationships with the underwriters, or do not have access to rating systems. CSRs have become the “go-to” experts on agency automation and client relationships.

In today’s world, we see CSRs, CSAs, service agents, account representatives, account executives, and account managers (among other titles) working as agents. They obtain the information, complete the application, submit and/or rate the risk, present the quote, advise the client, and ultimately bind the risk. And, as some agencies pay commissions to CSRs who handle the whole new risk from beginning to end, automation is a key component that helps them to accomplish their objectives most effectively and earn additional income.

In terms of that double-edged sword, it is essential that you do not self-inflict damage by wielding the sword in an inexperienced manner. Automation knowledge is essential in our industry, and service personnel who do not use automation systems to their advantage will be hampered by their lack of knowledge, which ultimately hurts their agencies, their carriers, and their clients, as well.

Because learning how to effectively navigate the complexities of automation systems can be daunting, I know of many CSRs who have been hired because of their knowledge and expertise in a particular operating system. It is a significant consideration to an insurance agency when looking to hire a new employee who knows its operating system. That knowledge significantly reduces the new employee’s learning curve.

Judicious use of automation

An additional factor concerning automation is rarely considered. Perhaps the simplest and most widespread example is email. In just a few short years, business communication has been transformed as emails consume our time. However, phones have not lost their value. When email responses have not been received, phone calls will often do the trick. Difficulty arises when CSRs continually resend emails hoping that they will serve as a speedy means to obtain a response when, oftentimes, the phone would be a better choice. In order to obtain a desired result, a realistic use of communication methods and all agency automation may sometimes be at odds with conventional wisdom and methodologies.

The way in which customer service personnel use automation is critical to the success of agencies. In fact, without these individuals, we would not know how to access our systems, what our underwriters’ names and emails are, and where that last email is filed. Great CSRs make a great agency, and one of the important ways that they do so is by grasping the sword of automation with a hand that knows how to use it effectively.

The author

Lynn DellaCroce, CIC, CISR, CPIW, has enjoyed working in a professional insurance position in the independent insurance realm for over 40 years. Those years included work as a CSR and as an agent. Lynn is currently an agent working for HUB International in Santa Maria, California. In addition, she teaches insurance classes, such as The National Alliance’s CISR and Dynamics of Service.

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