"Everyone is working longer hours and later days. The wee hours of the night are the only free time many individuals have to perform information maintenance. They can't afford to do these tasks during regular agency office hours."
By Len Strazewski
"Everyone is working longer hours and later days. The wee hours of the night are the only free time many individuals have to perform information maintenance. They can't afford to do these tasks during regular agency office hours."
--Maureen Wall, IIAA vice president for communications
Independent agent John Love sleeps peacefully, never fearing a late night telephone call from his agency's commercial or personal lines customers. It's not that Love, vice president of Armfield, Harrison & Thomas, Inc., in Leesburg, Virginia, doesn't care. He simply has their needs covered.
When his clients have after-hours coverage questions or need to update their risk portfolio, they connect directly with the AH&T online customer database to make informational changes or confirm their risk management program details.
Commercial clients can also view an organizational chart of their company's insurance program, or view a schedule of coverages, values, property locations, auto fleet listings and workers compensation payrolls, among other risk portfolio items.
They can notify the agency of changes in these schedules, request a certificate of insurance, report a transit shipment or report a claim, beginning with a mouse click on the agency Web site (http://www.ahtins.com).
AH&T, founded in 1921, has 75 employees and about 5,000 predomin-antly commercial lines customers.
The agency's book of business is 65% property/casualty, 25% employee benefits and about 10% personal lines.
Love, director of the agency's extensive technology specialty, began developing the firm's online customer service capabilities in 1997 after attending a seminar on using the Internet to manage information. While other agencies were fixated on the Internet as a marketing tool, Love began to explore the technology as an administrative tool--a way to reduce the workload of customer service representatives and extend service hours to customers.
In 1998, Love and a Web design team that now consists of five full-time employees, began building interactive database functions for large clients, particularly his own book of technology companies that would appreciate the self-service capabilities.
"At the time, there really wasn't any good way to do this directly with our agency management system," he recalls. "We knew it would be a lot of re-keying of data, but I believed that the efficiency and extra service for the customer would be worth the effort.
"We wanted to give our customer service agents more time to deal with the higher level service issues and reduce the number of minor administrative tasks. So we just started in the direction of building what we wanted rather than waiting for the industry to catch up with our vision of our needs," he says.
The agency began with 80 of its largest clients and expanded the service as word got around that the firm had this high-tech capability, Love says.
Last year, the industry did catch up--with the Sagitta browser-based interface from AMS Services. The Sagitta system allows the agency to set up individual customer access for account information stored in the agency database, an interface that allowed the agency to expand online capability to personal lines customers.
Love says online access and customer service has helped differentiate the agency in a competitive marketplace, but 24x7 customer service and online access to policy information is not a new idea.
The largest brokers have provided Fortune 500 clients access to claims and coverage information with proprietary computer network connections for more than 20 years. However, independent agents have been slow to extend their customer service hours or adopt the new technology that allows clients access to their own policy information.
Last year, the Independent Insurance Agents of America (IIAA) in Alexandria, Virginia, released the results of a comprehensive agent/client survey that identified service and technology issues important to the success of the independent agent "brand."
The survey, conducted by Addison, a San Francisco, California-based consulting firm, revealed, among other concerns, that agents underestimate customer desire for services, notes Maureen Wall, IIAA vice president for communications.
Agency customers indicated that that 24-hours-a-day, 7-days-a-week customer service was one of the most important purchase influences, noted by 87% percent of respondents. Only about one third of agents rated this level of service highly.
Agents also underestimated the breadth of service their clients desire, Wall says. "The perception among agents was that they already delivered 24x7 service because they gave out a home telephone number. They confused emergency service with extended customer service."
Addison conducted in-depth interviews with 9 insurance company executives, 11 state association leaders, 16 agency leaders and 4 market leaders and innovators to derive a well-defined portrait of the state of the insurance industry and develop key questions for agents and their customers.
The company then interviewed 304 personal lines insurance consumers and 100 small business owners and compared their responses to 91 independent agents who responded to an online survey.
The consumer interviews indicated that agency clients want access to general information about their coverage and policy detail, the same kind of access that banks now provide through toll-free and interactive telephone service and online banking sites. However, most customers would not use an agent's home telephone number to access or revise general information, Wall says.
Customers say they want access to control the accuracy of their account information and save time with routine policy changes and inquiries. "Everyone is working longer hours and later days," Wall says. "The wee hours of the night are the only free time many individuals have to perform information maintenance. They can't afford to do these tasks during regular agency office hours."
Extended hours of access also has marketing advantages. Direct writers such as Allstate, State Farm and Geico aggressively promote 24x7 customer service, raising expectations for insurance marketers.
Agencies are slowly catching on to the need for extended customer service and some are devising their own staff plans to cover agency customer service phone lines. Others are purchasing service packages to cover non-office hours. idNet, a customer service package endorsed by IIAA, provides 24x7 telephone and online services, Wall notes.
Online access through the public Internet is also a new service venue for agents, but a service medium highly in demand by agency clients, according to the IIAA research. More than half of the clients surveyed consider online access to account information to be very or extremely important. Only 6% of agents agreed.
About 59% of clients said they believed that agents already provide online services, but only 15% of agents said they had the services available--a potential source of disappointment and conflict.
Many agents have aggressively developed Web sites with online rating and purchasing functions, but the IIAA survey indicated that customers were less interested in purchasing insurance online than they were in accessing existing coverage information online, Wall says.
When AH&T producers open discussion with a prospect who might benefit from online access, they request a password and an online demo account. Thanks to the new capacity provided by the Sagitta connection to the agency management system, each new customer receives a letter with a user name and password for the Web site.
Here's how the system works. When property/casualty clients use their Internet connection to browse the agency Web site, they view typical commercial lines insurance news and services package featuring educational resources and online quotations for personal lines. Also on the Web site tool bar near the top of the page is a "Client Gateway" section.
After they enter their user name and password, they enter a "Client Services" section that lists their program summaries and schedules as well as the administrative capabilities. Technology group customers also have access to advanced educational functions, cyber risks information and disaster recovery resources.
Employee benefits clients--about 450 companies--also have online access, but see a menu designed for their distinct coverages and needs, Love says.
Personal lines customers can access the individual account information through the Sagitta system from the Client Gateway section. The Sagitta menu includes individual policy information including insured listings, vehicle information, payment history and the ability to print auto insurance identification cards.
AH&T doesn't charge for online access, Love says. The efficiency and security pays for the resource for large clients. "If we can get customers to process as little as 20% of routine account maintenance transactions using the online systems, rather than use our customer service representatives, we can dramatically increase our ability to meet their more complex needs during office hours. And we can make more resources available to our producers for new business marketing," he says.
Love also notes that the AH&T online system is more than a customer service tool. The high-tech access also gives the agency a marketing weapon that has allowed the agency to increase its portion of larger accounts ($50,000 or annual premium or more) by 20% over the past two years.
"We chose AH&T because our company operates subsidiaries in several countries in Europe, and our managers needed 24x7 access to our risk management program," notes the risk manager of a telecommunications infrastructure company which AH&T insures. "Through AH&T's Web site they can request certificates, report claims, and ensure that they have reported the right property values and locations. It was an important value-added service that has improved our internal communications."
AH&T doubled its sales force from 1998 to 2000 without a commensurate increase in its customer service team, he notes, creating opportunities for rapid growth that could only have been supported by the online customer service resources.
"The level of access for clients became a great sales tool. Many of the new clients came to us just because of this service capability," he says. "AH&T offers them something other agencies don't--the online service capability." *
The author
Len Strazewski is a Chicago-based freelance writer specializing in marketing, management and technology topics. In addition to contributing to Rough Notes, he has written on insurance for Business Insurance, the Chicago Tribune and Human Resource Executive, among other publications.