Data is the buzzword of the year for the insurance industry, with everyone from carriers to agencies trying to figure out how to use it to their advantage. While agencies might not have the same access to big data that’s applicable in underwriting, pricing, claims handling, and fraud identification, they do have some useful data on their customers that can be used to set key targets.
“They should be paying attention to data [because] you can’t improve what you don’t measure,” said Becky Schroeder, chief marketing officer at Insurance Technologies Corporation (ITC). “When you understand your data, when you look at it, and you see what your data is right now, it tells you how you’re doing today and where you currently are as a business and as an agency. And if you want to be somewhere different, it helps you plan where to go and how you’re going to get there, but you [first] have to have that benchmark of where you are today.”
Agencies that take a look at their data can actually impact their customers’ experiences during the insurance-buying transaction – for the better.
“The data can help you identify gaps or holes in the process. For example, if an agent is getting a lot of traffic to their insurance agency website from a particular source, but that traffic from that source is converting at a lower percentage than other traffic sources, something’s going on there,” explained Schroeder. “Something about the page that they’re landing on is not working, because if your conversion rate on your website is 15% and for this particular source it’s 8%, that’s almost half, so it really should be higher than that. You’re going to know that something’s going on here, and I need to get a deeper look at this and then find a way to fix it.”
Other metrics that agencies should be tracking is the number of policies they’re quoting, and how many of those they’re actually binding, as well as how long it takes to get from quote to bind, making sure to differentiate this last metric based on type of insurance since an auto quote can be done almost instantaneously while a life insurance quote can take longer.
“If you know your average time to go from quote to bind, you will be able to see the outliers and identify if, [for instance], Sally is binding policies within seven days on average, and the agency average is five, why is Sally taking longer? They can start trying to coach and improve Sally so that she can get faster and then sell more,” said Schroeder.
She added that an agency’s retention rate is likewise important. Most agencies do have an idea of their retention rate, but it’s usually a blanket rate, and they can really dig deeper into that particular metric to get an even better idea of their retention.
Finally, tracking leads is crucial for agencies.
“I talk to a lot of agencies and when I ask them where they get their leads, almost all of them will say referrals. And I [then ask], ‘but what else’?” said Schroeder. “[Referrals] are not enough to grow an agency. You have to be getting leads from other places. When they say referrals, it’s either they’re not really growing or they don’t really know because they’re not asking the question, ‘How did you hear about us?’ So, you want to start tracking that because you’ll be able to know what’s working, where you’re getting your leads, and then put more money and effort and time into those sources to help drive more leads.”
Agencies that want to jump onboard the data train might encounter a few key challenges in utilizing customer data – one of the biggest is actually finding the time to focus on the data component.
“A lot of agency owners wear multiple hats, especially smaller agencies where they’re doing a lot of things,” explained Schroeder. “It’s hard when you’re wearing so many hats to step away from the phone, to step away from the email, and focus on looking at the data and understanding what’s going on with the business so that you can make the business decisions you need to grow your agency.”
Another challenge is knowing the data that they already have available to them and where to find it. Agency management systems are key here.
“You’re going to have a ton of reports and data that you can pull up and look at. Some comparative raters will also have some basic reports and [others will] have more advanced reports,” Schroeder told Insurance Business. “And then use Google Analytics and actually look at the traffic to your website – where is it coming from, what’s converting, can you improve your conversion rate, where are people landing, where are they bouncing, what pages are they bouncing from, and can you improve those pages? And then if you’re using an email marketing tool, it is going to have a ton of reports and data in it as well.”