Taylor Rhodes, CEO of Applied Systems, made one fact clear when he delivered the keynote address at SIAA’s IA Evolve 2021 Virtual Conference last month: technology isn’t the boogeyman; rather, it’s here to help independent insurance agents. Mr. Rhodes indicated the proof of this is clear.

According to Applied Systems Digital Agency Report, technology super-charges small agencies by allowing 156 percent higher revenue per employee (RPE). Breaking down the benefits, the report notes:

  • 121 percent higher RPE for agencies with customer self-service portals
  • 98 percent higher RPE for agencies that connect digitally with insurers
  • 62 percent higher RPE for agencies that adopt data analytics solutions

Despite these opportunities, there are still agencies reluctant to fully embrace technology and cloud-based tech solutions, Rhodes said. J.D. Power’s 2021 U.S. Small Commercial Insurance Study saw independent agencies lose 15 points in customer satisfaction over previous findings. Part of that decline, he said, may have something to do with only 33 percent of small agencies offering client portals for self-service, and still fewer — only 27 percent — offering mobile apps.

Overcoming Fear
A major driver of the independent agency tech deficit continues to be fear. Some independent agents see digital transformation as intimidating. There’s also a concern technology will either replace the human element of the insurance business or chase away potential clients. Nothing could be further from the truth.

The Great Recession pushed consumers online in a big way. Then the pandemic significantly raised the stakes regarding the public’s willingness to engage online with businesses.

According to Rhodes, three out of four consumers now say they prefer resolving their issues through online self-service portals. These agency solutions — such as updating policy information, making payments or requesting ID cards or copies of policies — can be done faster and more efficiently online if the proper cloud-based tools are provided.

Adapting technology to an agency’s workflow can also help elevate the work of independent agents to generate increased income producing opportunities. Further, these online tools can aid agency staff in focusing on higher-level client and agency service issues, creating greater efficiencies.

We live in a world where consumers are now conditioned to have their needs met almost immediately through cloud-based technologies from companies like Amazon, Google, Netflix, Uber and others. Independent insurance agencies must do the same to help them punch above their weight class and meet the rising expectations consumers have adopted from other product and service providers. Failure to do so can translate to a serious loss of business.

Rhodes pointed to Deloitte’s “The Four Trends that Define Insurance,” which noted that 52 percent of consumers are willing to switch insurance providers to get increased online service options. Those that provide such options realize a 60 percent rise in profits, according to Deloitte.

By connecting to clients digitally through available cloud-based solutions, independent agents can gain hours of efficiency, eliminate routine task work and empower employees through greater productivity and job satisfaction.