In nearly every industry today, consumers can find a seemingly endless amount of information online. This availability has made them less dependent on both brick-and-mortar stores and a wide range of intermediaries, independent insurance agents included. The broad use of internet-based platforms from Amazon and Airbnb to GEICO and Hippo have conditioned consumers to see every product as a commodity. With the rise of InsurTech, consumers’ default expectation for insurance is efficient, rapid and affordable. This change creates challenges but also a unique opportunity for independent agents who are willing to adapt to meet this new expectation.
The Opportunity. Embracing change means independent insurance agents must become advisors and advocates. This role can best be accomplished today when agencies are driven by technology and new consumer behavior.
This isn’t wholesale change. It’s an evolution. Agents still play a role in service and claims when needed. However, their compensation will be dependent on the value they bring to the consumer and the carrier. That value will be translated through expertise, effective marketing, reduced friction and operational efficiency. This will be the winning combination to help agents and agencies win business and scale for growth.
Digital Marketing. Consumers aren’t interested in general guidance. They have the internet for that. But they will look to agents who offer them expertise and advice tailored to their situation. This means moving beyond the traditional “local” agency model. Agencies will need to look at the market more broadly. They should articulate who their prospective customer is and what personalized product offerings they can provide. As trust is built, clients will turn to their agents for more holistic insurance advice and provide referrals.
To reach these consumers, agents will have to become better marketers. Specifically, they need to invest in digital marketing. Successful agents will incorporate social media, including video, to reach today’s — and tomorrow’s — consumers. And we’re not just talking about marketing to digital natives. Consumers across generations have all gone digital in some aspect of their lives. Consumers now expect their purchase journey to start online. Agents will need to factor this into their marketing with their websites, mobile phones, emails, texts and even direct mail efforts. Utilizing all of these tools significantly reduces the friction previously inherent in the insurance purchase process.
Ease of Operations. Finally, ease of operations and efficiency will help agents embrace their new role. It will also help them develop new business. Agency management systems, customer relationship management systems, electronic billing, auto-fill forms for quotes on your website and via a mobile app…all are examples of reducing friction between the agency and the consumer. By making it easier for clients and prospects to engage with you, the expert and advisor, you will build trust, connection and a solid business model.
There has never been a more exciting time to be an independent insurance agent. As the industry evolves, agents have an opportunity to shape their future in ways prior generations could not have imagined. The most successful agents will recognize this opportunity, embrace it and help make it a reality – reducing friction is a part of that reality.