Key strategies to implement now
By Dustin Lemick
Property and casualty (P-C) insurance agents and brokers have faced significant challenges in the past few years. This has forced industry leaders to adapt to new ways of doing business and has impacted how they serve clients and drive sales.
Leaders can no longer neglect to leverage technology or rely on past approaches to success. Today’s market and continued nebulous economy demand change.
While consumers have not adopted buying directly from providers as many insurtechs once believed, agents and brokers still endure a multitude of other difficulties. Rising consumer costs across all lines of insurance, changing consumer behavior, and homeowners insurance providers leaving states like California and Florida are impacting business.
A reported 23% of insurance
customers have said they have or are considering switching to a new insurance agent this year; 51% of consumers said they are looking for ways to save money on their existing insurance policies.
When asked how they are saving money on insurance, 26% are decreasing or plan to decrease coverage or limits on existing policies and 20% have already removed a policy from their coverage or plan to in the next six months. Additionally, new advancements in technology like artificial intelligence (AI) also have potential to create new disruption in the future. The market is not likely to return to what it once was.
It has been a wake-up call for agents and brokers. However, it is possible to adapt and thrive. Try the following strategies to give your agency the potential for new opportunities to succeed.
Create a new strategy
With the challenges agents and brokers face today, developing a new agency strategy to adapt your business is the first step. It should include how to help clients navigate rising costs and change. Consumers and businesses need agents and brokers for their guidance, knowledge and direction more than ever.
It’s important that your agency is ready and rises to the challenge.
Your strategy should also have a strong emphasis on customer retention. Assumptions that most clients will renew with minimal contact no longer holds.
Agents and brokers should consider a more aggressive approach in the context of an advisory role. There should also be a clear plan for how your business can grow. For example, expanding to new lines of business or exploring new ways of attaining customers.
Additionally, consider where and how you can leverage technology to benefit your business and company. Technology is a competitive advantage for agents and brokers, and is only more so in a difficult market.
Today’s consumers and businesses expect technology to be part of the process. There are also numerous other benefits as well.
At my company, for example, our online platform enables agents and brokers to manage or change policies in a matter of minutes. We use technology to provide a finalized quote in seconds, with just six basic underwriting questions.
High tech can also help retain your employees and create a better work environment. Overlooking innovation is no longer an option.
Leverage different approaches
Difficult, changing markets require doing business in new ways. For example, bundling insurance has long been a tentpole path in P-C insurance. In some instances, it may still be the best way for clients to save money.
However, other factors besides cost should be taken into consideration, such as the effect of a claim on a homeowners policy.
We have seen agents and brokers save their customers money by moving to stand-alone insurance for jewelry or other personal belongings. Benefits can go beyond cost savings, including improved coverage, reduced or no deductibles, and no reporting of claims to third parties, among other advantages.
Constantly seek what is best for your clients. Be ready to spend time with them to find the right solutions. Traditional approaches aren’t always the best choice today.
Customers also have far more access to information than ever before. The internet and technology provide them with new means to collect and act on information. Agents and brokers should constantly do the same.
With insurance premiums increasing, more clients will be comparing coverages, rates and their agents. Be the resource people can turn to instead. Stay aware of shifts and changes in the market, current and future challenges, and key happenings. Be their modern trusted advisor.
In the past, insurance agents and brokers were often able to take a more reactive approach to succeed. It is not viable in a volatile market, where a proactive effort is mandatory. Today’s agents and brokers need to step up and uplevel their service.
The REACT imperative can be a great strategy guideline here. The initial letters stand for:
Respond by reaching out to show you care. Be proactive with clients via email or phone calls. Let them know you’re aware of what’s happening in the market and provide guidance on how they should react. Return calls and reply to emails quickly.
Educate clients to help set thier expectations. Consumers and businesses are not insurance experts. When they see market events reported in the media, they want guidance and help. Show your clients that you can explain these changes, what to do, and what to expect.
Accelerate your use of technology to improve efficiency and responsiveness. Look for all the ways you can advance your business, reduce costs, retain talent and customers, and operate more efficiently. It may be implementing a new technology or process, or a better, more efficient way to operate. Be flexible to better serve clients and help your business.
Communicate continuously to support and reinforce your client relationships. Good communication with clients creates and maintains trust and relationships. Proactively contact your clients to see how they are feeling, offer your insight and support. Make practical suggestions for how they can minimize their risks and be a sounding board.
Take action now to meet your clients’ needs. Clients are seeking someone who can support them. Constantly show your clients that you are a resource they can turn to, and that you can do something to help them. Take instant action with clear steps that help them.
Don’t wait or hesitate
Agents and brokers need to act on behalf of their clients today. Clients need our support and guidance, and the assurance that we can help. Competition for customers and their business is only likely to intensify and escalate.
Don’t wait until times are difficult or get worse. These practices and tactics should be in place regardless of market conditions. Agents and brokers who rise to the top will be the winners.
Dustin Lemick is founder and CEO of BriteCo, a firm that specializes in insurance for jewelry