BLOG: The question that cannot be ignored!

If we aren't delivering the value carriers want and if they believe they'll make more money going solo, they'll stop using us, writes Lynne Wallace of NDOI.

Workers Comp

By

This week another of the country's largest insurers announced it will bypass its existing independent retail and wholesale agent sales force and begin selling workers compensation policies directly (and online) to consumers. No apologies for jumping in front of us...just a national "heads-up". Are we concerned?

Well, if we aren't delivering the value carriers want and if they believe they'll make more money going solo, they'll stop using us. It's interesting that they didn't cut agents out, they simply gave consumers the additional option of buying directly. I think it's safe to say the carrier is aligning with a growing band of consumers who want a direct digital option (which too often, today, means leaving the agent out).

A recent study projected a 3-5 year change in insurance consumer "channel preferences." A channel is a method of delivering service. The service categories studied included: Before Purchase, Purchase, After Purchase, Claims, and Feedback. It compared three channels...

• Physical Channel (the more traditional agency model)

• Contact or Call Center

• Digital Channel (online and mobile assistance)
 

The results in almost all categories overwhelmingly favored "digital" over the other channels. There was, however, one sub-category where "digital" did not lead the pack. That sub-category was "Before Purchase- Advice." It seems insurance clients want professional insurance advice when they need to make a significant coverage buying decision. But after that, they go right back to wanting tech-powered instant service. "After Purchase-Inquiries and Service" scored a 30% increase in digital preference.

So where will consumers of the future—who love digital—go for professional insurance advice? It appears it won't be call centers. Contact/Call Centers are projected to experience as much as a 40% drop in popularity over the next 3-5 years. That leaves it to licensed insurance professionals—which appears to be good news for us. But there's a catch...the insurance professionals chosen by consumers in the future will need a digital ticket to enter. We'll need to offer the online self-service platform, mobile apps, predictive touches, and cloud solutions that enable our clients to move faster and be more profitable.

So again we're left facing the writing on the wall...evolve digitally or become extinct.

It's time for every agency and every agent to own their digital insurance future. If we aren't working from a strong, future-focused digital platform, we are vulnerable. It's a matter of time and money. How much time will our clients give us? How much will it cost for us to get up to speed?

My take is that clients are incredibly loyal until someone walks in with game-changing technology that delivers excellent insurance, dramatically saves time and money and helps them grow their organization. At that point, what we'll hear next is "Ok, I love you, bye bye!"

Incredible digital platforms are emerging in the insurance industry. Our options are clear...purchase and install one, partner to access a leading edge platform, or sell/merge with an agency that can give you what you need. The ultimate survival question is not "if you will serve your clients digitally" but rather "when will you be ready to do so?

Lynne Wallace is the CEO and president of VANTREO Insurance Brokerage and co-founder of NDOI, the National Directory of Insurance.

Keep up with the latest news and events

Join our mailing list, it’s free!