Amid the changes in our business,
it’s more important than ever to focus on being a good client partner
Office culture, in many respects, has been lost. With all the changes,
providing clients with the service they demand feels like it has become more difficult.
by Michael Wayne
Recently, I attended a retirement party for a risk control colleague. He was saying goodbye to his time with our agency after 30-plus years. Celebrating with friends and acquaintances, it struck me how different the office must have been back when this colleague was starting out. Truthfully, it really stung how different the office was from just five or six years ago. As of late, we haven’t been making the same type of effort to bond like we did in the past.
There have been several mitigating factors that have contributed to this change. In addition to the older employees in the office leaving or retiring, the ones who have stuck around don’t really have the same opportunity to pass along agency traditions to the next generation. The effects of the pandemic continue to linger in the form of more people working from home. Office culture, in many respects, has been lost.
With all the changes, providing clients with the service they demand feels like it has become more difficult. Here are the Top 5 critical areas that you, as an experienced agent, need to pay attention to right now to continue being the partner your clients expect.
Still squeezed tight: navigating the casualty market
Hopes that the casualty market would soften anytime soon are pretty much dashed at this point. Premiums are rising, and the challenge of securing the necessary capacity for tougher risks is as difficult as it has ever been.
Condo associations, big rig fleets, property in vulnerable wildfire and other CAT-prone areas—regardless of what it is, you’re going to have to work harder to make your client’s risk profile appealing enough for a carrier to entertain the notion of coverage.
Either you’ve been around long enough that you’ve been through this before, or you’ve heard war stories from more seasoned veterans of how to survive and thrive through this. There isn’t a magic bullet for complex environments like we’re seeing. You have to:
- Dissect the drivers behind rate hikes and capacity crunches in specific casualty lines.
- Examine how you are communicating these realities to clients without appearing as if you’re clueless about navigating what’s going on.
- Determine if you are doing everything to meticulously present good risks to underwriters.
- Explore and discuss alternatives and creative solutions, like captives, for clients that fit the profile.
- Maintain and enhance relationships with underwriters.
Mother Nature’s increasing tab: climate change and the coverage conundrum
The official highest registered air temperature on Earth is 134.1 degrees Fahrenheit, recorded July 10, 1913, in Death Valley, California. Considering the planet’s 4.5 billion-plus year lifespan, our records are not extensive. Scientists estimate the collision that spawned the moon caused Earth’s temperature to rise to approximately 3,680 degrees Fahrenheit. That’s a bit hotter than 134.1 degrees Fahrenheit.
Regardless of what you believe the contributing or primary factors to be, Earth’s climate does change. Last year saw record-breaking insured losses from natural disasters; and it seems like each year we see a new record from a combination of wildfires, hurricanes, tornadoes, floods, and earthquakes. Carriers are acting in kind. They’re raising premiums or, in certain cases, pulling out of markets all together. To truly help clients, you need to:
- Stay abreast of the latest climate risk models and how they’re influencing underwriting decisions.
- Have conversations with clients about escalating risks and potential coverage gaps.
- Help clients explore risk mitigation measures that can improve their insurability and potentially lower their premiums—things like installing fire-resistant materials or elevating structures.
- Understand the role of government-backed insurance programs and how they intersect with private coverage.
- Have a grasp of emerging insurance products specifically designed to address climate-related exposures.
The digital shift: time to adapt
The insurance industry, overall, can be considered a laggard when it comes to technology. Things are changing rapidly, with AI and big data driving the proverbial bus, though. There’s actually a third driver: clients. Client expectations for a seamless, digital-first experience that includes online quoting, self-service portals, the ability to connect on their smart devices, and more, are here and only expanding.
If you consider yourself to be a seasoned agent, you likely know the story of Paul Bunyan. Ultimately, technological advances bested the larger-than-life lumberjack. Think about the tedious tasks you and your team have to deal with daily and how you could be better spending your time. Ask yourself:
- Am I strategically adopting technologies that streamline workflows and enhance client interactions, including user-friendly client portals?
- Do I have a solid understanding of how carriers are using AI and data analytics and how I can leverage those insights?
- As someone who has been embracing digital aspects, am I vigilant about retaining the crucial human connection and trust that clients also desire?
- While protecting my clients from cyber threats, am I doing the same for my systems?
- Am I keeping an eye out for new digital products and determining which could actually be relevant and beneficial for my clients?
Riding the economic waves: uncertainty and your clients’ coverage needs
Economic waters are choppy. Inflation, tariffs, war, politics in general … it’s a list of ingredients that combine to make uncertainty soup. Uncertainty is a menu item that does not sit well with clients. It can affect their business, their personal finances, and even their ability to pay for the coverage they require.
Just as the Earth itself is prone to changes in climate, so too are the manmade constructs that drive life and business. Just as the Earth itself gets rocked from time-to-time because of tectonic shifts, seismic shifts randomly rock the world of finance. You’ve seen it before. You’ll see it again.
Take what is happening and what has happened before into consideration as you:
- Discuss how inflation can impact coverage limits.
- Assess how potential supply chain disruptions or trade policy changes could affect your business clients and their coverage needs.
- Work to maintain adequate protection for your clients while navigating the challenge of rising premiums.
- Look for value-added services and advice that extend beyond simply selling a client an insurance policy.
- Stay aware of prevailing economic forecasts and how they might specifically impact different sectors of your client base.
The talent tapestry: weaving in the next generation and ensuring agency longevity
At the outset, I bemoaned the deterioration of agency culture and alluded to a generation being lost to retirement and a severe lack of replacements on the horizon. Cultivating new talent is crucial.
The next industry generation is extremely tech-savvy and is exactly who the industry needs to walk through the doors of agencies everywhere. They, by and large, can drag the industry into its next era to meet clients where they are, instead of trying to force clients on a preconceived, and potentially outdated, journey.
This is also the time to look out for yourself. This phase of your life may be close to its end. You may find yourself part of a merger or acquisition you don’t want to be a part of. Whether you are choosing to stick it out or are ready to hang things up and call it a career makes a difference in the short term and long term. You have to determine:
- Are you helping the agency by actively exploring and implementing strategies to attract and retain younger talent?
- Are you part of your agency’s mentorship programs and knowledge transfer initiatives to ensure a smooth transition, and are these even in place for you to do so?
- If you’re considering selling or merging your agency, are you staying informed about current agency valuation trends and the complexities of the process?
- Are you prepared for the potential cultural and operational adjustments that can accompany an agency acquisition?
- Are you working with other industry colleagues to effectively showcase the rewards of an insurance career to attract bright, new talent?
The industry is not boring. Frankly, it never has been. There’s always something new to learn, and there’s always a solution that can literally change the life of a client or a colleague. Stay informed. Stay engaged. Always look to improve yourself and those around you.
The author
Michael Wayne is an insurance freelance writer.
