Customer demand for simplicity, flexibility, and transparency across all aspects of the insurance experience has been pushing the industry to change how it does business for some time. A silver lining of the COVID-19 pandemic is that it forced a more rapid acceleration toward improved efficiency, operational focus, and clear and intentional strategy.
It was difficult for the entire industry to adapt, but it was particularly difficult for agents who rely exclusively on in-person interactions to build and maintain client relationships. Agencies had to quickly adapt their business models and determine how to communicate with their customers most effectively while still providing critical insurance insights and meeting coverage needs.
At the carrier level, we’ve seen many agencies that not only successfully navigated this tumultuous time but also evolved to operate more efficiently and effectively than ever. These agencies developed a clear plan for navigating through the time of uncertainty and came out on the other side with a holistic picture to better serve their customers and grow.
Here’s several trends we see from the successful agencies that didn’t just survive; they thrived.
It’s no secret that the insurance industry has been slow to keep up when it comes to leveraging technology, particularly compared to other industries. This has held back some agencies and carriers, and the pandemic really underscored this disparity.
Unsurprisingly, those agencies that invested in customer-facing technology that allows them to engage with and support their clients fared much better than those that hadn’t. In the last two years, we saw agencies increasingly stepping up their omnichannel capabilities with the goal of improving the customer buying process. This includes increasing the speed with which clients can secure coverage and connectivity to products.
These agencies will continue to see the benefits of their investment going forward.
Technology also created new opportunities for agents as they navigated business uncertainty. The smaller, more transactional business that agents previously stayed away from because it wasn’t cost-effective can now be more efficiently processed through technology. With little work on their part, agents can work with carriers to easily offer more products.
The adaption of this technology ensures that agents can still connect with their customers at any time while improving the sales process. This allows them to satisfy the needs of their customers, remain relevant, and grow their business.
There is a lot of pressure on the industry to improve its efficiency and ease of doing business. We are catching up, but there’s so much technology out there and it is ever-changing. That makes it tough for a business to determine what is right for them. Doing nothing, however, is no longer an option.
Another trend among successful agencies that we expect will continue is a high level of communication with clients.
The pandemic triggered an increase in coverage discussions among insureds, particularly as business interruption claims were denied because of policy exclusions. Clients sought advice from, and asked more questions of, their agents on what coverages were needed to protect their business.
Today, we hear from our partners that the nature of the sales and renewal conversation is less about price and more about securing adequate protection.
Agents are now proactively conducting annual policy reviews, which wasn’t necessarily part of many agency opera-ting models before the pandemic. This highly positive development for agencies and their customers helps demonstrate the agents’ value.
Agencies are also now providing advice and counsel to clients using a multitude of platforms and channels, including social media, interactive educational materials, and better risk management opportunities through either the agency or their carrier partners.
Agencies had to adapt quickly how they attracted and retained talent over the last few years. Those that normally employed people from within their own geographies suddenly had to compete with employers in other areas, thanks to the shift to remote work.
Some smaller agencies lost employees, or failed to recruit new ones, because larger companies could pay more or offer better benefits. This trend is unlikely to go away.
A benefit of greater focus on talent development has been an increased emphasis on diversity, equity, and inclusion (DEI) efforts. Although there is still much work to be done on this business imperative, more agencies and brokers are making DEI a priority in their operating models.
It isn’t impossible for agencies to compete, but they must be intentional in their approach. The successful agencies have looked outside their own locations and recruited talent in places where they can also grow their business with new customers, as well as provide ongoing service to retain business.
It’s not just the agencies that have had to adapt and adjust. As a carrier, we are engaging with our agency partners in more strategic conversations than we have in the past. We’re thinking about not only where their investments are today and will be tomorrow but also how we will need to deploy our own investments in people, technology, and processes to maintain thriving successful partnerships.
Agents should look for companies that are willing to partner more deeply, which includes offering higher levels of connectivity and working together on strategies to move forward.
It’s also about products. We’re specifically trying to understand how we can better serve insureds with our existing products or what new products we can develop to meet their needs. Agents are a good resource to carriers in terms of what customers are seeking coverage for. Working together, we can all benefit from new opportunities.
The last two years have been challenging but the industry stepped up and is thriving. Still, we should be careful not to assume we won’t face other significant disruptions in the future. Remembering the lessons we’ve learned and making the right decisions today to support your agency through difficult times will help your business continue to evolve and gro
Eddie Riveiro is vice president of business development, Portfolio Underwriting and Operations for Small Business, at Westfield Insurance, a property/casualty insurance carrier founded in 1848. Based in Westfield Center, Ohio, Westfield provides commercial insurance in 21 states, personal insurance in 10 states, and specialty and surety products in all 50 states. Riveiro can be reached at EddieRiveiro@westfieldgrp.com.