AGENCY MARKETING TECHNOLOGY
Sites that function like a traditional E&S broker, MGA or wholesale broker improve market access for newly formed agencies
By Steve Anderson
It's never been easy to start up a new agency but during the last 10 to 15 years, the number of startup insurance agencies has been particularly small. Soft market conditions, along with the consolidation within agency ranks, has made it especially difficult to start an agency from scratch.
When we ask agents across the country what they perceive as the biggest problem in starting a new agency, they respond: "contracts," i.e., being able to obtain a contract with an insurance company so a new agent has products to sell. Most standard carriers will not offer a contract to a new agency without hundreds of thousands of dollars in production requirements.
Insurance companies have contributed to the difficulties associated with starting a new agency by requiring higher and higher production from their agency force. Such production goals are often unattainable by a start-up agency. A producer's excellent selling skills and the desire to strike out on his/her own can't overcome the fact that the producer can't gain access to insurance products to sell. Combine all of these factors and the industry has created an almost insurmountable hurdle to starting a new agency.
But I bet you won't be surprised to learn that the Internet is changing this dynamic. I've been involved in this industry for more than 20 years, and it is easier today to start a new agency than at any time during that period. In this month's column we will address one of the barriers that the Internet has lowered, if not completely removed--what we call market access.
Let's look at a few of the options available today. What follows is not an exhaustive list; it simply describes a few of the companies we are aware of. Each of these Web sites functions like a traditional E&S broker, MGA or wholesale broker. These organizations have harnessed the power of the Web to streamline their back office operations to make your life easier.
businessriskpartners.com -- Business Risk Partners is a managing general agent licensed as a surplus lines producer that underwrites professional liability on behalf of several syndicates at Lloyd's. BRP provides agents access to errors and omissions coverage for 150+ classes of business. From application to binding to renewals and claims, the process virtually eliminates paperwork and makes it simple for agents to buy and manage coverage for their clients. The site also offers educational content that agents can use and pass on to their clients to educate them about the need for professional liability coverage.
InsuranceNoodle.com -- InsuranceNoodle offers small business owners fast, easy, one-stop shopping for all of their property and liability insurance needs. The companies used by InsuranceNoodle include: AIG, Chubb, CNA Surety, The Hartford, Kemper, Markel, The St. Paul and Zurich U.S. InsuranceNoodle also provides licensed insurance advisors, available from 7 a.m. to 10 p.m., Central Standard Time, Monday through Friday. The advisors can be reached by calling a toll-free phone number, by live online chat or by e-mail. This site markets directly to the small business owner, but an agency can join the "NoodleNetwork" and add the same functionality to the agency's Web site for their own clients and prospects.
InsurePoint.com -- InsurePoint was formed in 1997 as a joint venture of New Jersey-based Atlantic Mutual Insurance Company and California-based Bolton & Company. The company became the first independent-agent-supported, full service Internet storefront providing business insurance targeting small and emerging high-tech companies. InsurePoint operates in 30 states and offers property, general liability, errors and omissions, workers compensation and umbrella. The InsurePoint commercial lines platform provides single entry, multi-company competitive rating, quoting, and binding for BOP, workers compensation, commercial auto and umbrella. Additional product lines will be added later this year. InsurePoint handles new business, endorsements, and renewals.
InsureZone.com -- This site was created by an independent agency in Ft. Worth, Texas, and offers access to insurance products through multiple channels. InsureZone recently acquired AgentSecure Enterprises, Inc., which launched AgentSecure.com in October 2000 as a Web-based insurance service designed for small and rural commercial agents. Under InsureZone, AgentSecure.com will expand its original platform of carriers--CNA, The Hartford, and Zurich North America Small Business--to include Kemper Insurance and The St. Paul. Additional small commercial products will also be offered by these carriers as a result of the InsureZone/AgentSecure.com combination.
mexicaninsuranceonline.com -- Have a client wanting to drive in Mexico? Now you can process Mexican auto insurance policies with virtually no faxing, no mailing, no waiting, and no worries. You are able, using this Web site, to issue policies that are agency billed in the traditional way. Don't want to spend your time issuing this coverage? Then, using a link from your Web site, let your client go online to quote, purchase and then print short-term Mexican auto insurance policies (up to 25 days). With this link, your agency code is automatically embedded in the link and you get immediate credit for the sale. Throughout the purchasing process, your agency name, e-mail and Web site addresses and phone numbers will pop up to assist the client. Upon completion of the sale, the client is immediately returned to your Web site.
SuperiorAccess.com -- Superior Access Insurance Services (SAIS) is a managing general agency that offers wholesale insurance products, goods and services to agents and brokers across the country. They began operations in 1995 with personal lines fire as their primary market. Their Internet strategy evolved from an initial offering of workers compensation insurance. SuperiorAccess.com now provides agents with a single Web site to access company markets, instant Internet-based quoting for each program, proposal generation, and other products and services (such as MVRs) that every agent needs. Programs are included for commercial insurance, personal lines and life and health. Agents can make use of the quoting capacity of the site by having agency staff access the quoting engine on behalf of a particular client, or the agency can create a link on the agency's own Web site to allow clients and prospects to request their own quotes.
YouZoom.com -- This site enables you to sell personal lines coverages online. YouZoom develops and hosts your agency's own, customized Web site which contains online rating and binding capabilities, as well as the backend infrastructure to successfully sell insurance policies online. Then, once your Web site is up and running, the YouZoom business development team will provide training and advice to help you capitalize on new business opportunities. The Web site features comprehensive online account management tools so customers can update policy details, report a claim, and track payments directly. They also provide a 24x7 customer contact center.
The sites mentioned above are just a few of the sites that are available to anyone who wants to start an agency. They provide the products, and in many cases the back office services, that will help any agency (new or old) concentrate on selling to prospects and clients. *
The author
Steve Anderson has been a licensed insurance agent for more than 20 years. He is president of steveanderson.com, Inc., which provides products and services that help agents maximize profits using commonsense technology. E-mails are welcome at steve@SteveAnderson.com or he can be reached at (615) 599-0085. Visit his Web site at www.steveanderson.com for more information.