In the past, many in insurtech believed that independent insurance agents and brokers would be replaced by technology. That consumers would choose to buy insurance policies directly from insurance providers online instead. As a result, independent insurance agents and brokers were often excluded from the new technologies and business models insurtechs were creating. Beyond aggregator websites, a few innovations included agents and brokers.
It overlooked the value and significance of independent insurance agents and brokers to consumers, as well as to the insurance industry. Despite that technology has enabled consumers to engage with insurance providers online, 71% like human contact more, according to a study of the online consumer by Celent. Insurtechs also neglected the important role agents and brokers play in driving customers and revenue to insurance carriers.
However, savvy insurtechs now recognize that agents and brokers are a key part of the industry’s ecosystem. These insurtechs know that consumers have different needs and preferences when buying insurance. Some consumers prefer to purchase directly from insurance providers online, while others want the help, guidance, and support that agents and brokers give. These insurtechs also see how insurance agents and brokers can contribute to the success of their companies.
With insurance premiums rising, ongoing economic challenges, and other issues, consumers, insurance agents, and brokers are seeking ways to save money and achieve their goals. They need to make changes and want help. For consumers, this means finding ways to reduce costs and make things easier. They often turn to technology and the internet to achieve this and expect tech-enabled experiences. They’ll go elsewhere if innovation and ease aren’t part of the process. This includes when buying insurance from agents and brokers.
For insurance agents and brokers, it is learning how to do business differently. They must now rise to meet consumer demand for easier experiences and processes, faster service, and lower costs. They can no longer ignore technology and the internet. Those that want to switch from a captive to an independent industry to increase their opportunity and market reach need to adapt to new ways.
Agents and brokers can also benefit from new approaches and ideas to modernize their businesses in other ways. This won’t just help meet consumer demand for tech-enabled experiences or empower agents and brokers to do business better. It can also impact employee retention and attract talent, which can reduce the high turnover often seen in the industry. A lasting team of talented people will create a stronger, more successful business, and better client relationships can result.
Firefly uses technology and the internet to help independent insurance agents and brokers succeed by connecting them with carriers without the burden of production requirements, as well as providing guidance, insight, and other tools to help them learn and succeed. My company, BriteCo, has a tech-driven Agent and Brokers program that empowers agents and brokers to offer our jewelry insurance to their customers. The program helps agents and brokers better meet their clients needs and provides an opportunity to expand their line of business. It was always in our strategic plan to open this channel for the industry as a complement to our direct-to-consumer business because we know the value of agents and brokers. More insurtechs are likely to include agents and brokers in their business as well.
While insurtechs are now recognizing the importance of agents and brokers, agents and brokers still need to constantly adapt and evolve their business. They need to be on the cutting edge of innovation and ability to meet the demand of speed and ease. They must quote and sell quickly, with faster binding and more efficient claims management. The era of long insurance timelines and traditional paperwork is gone. Industry professionals also need to remember that they are educators in the market who need to help their clients understand their offerings and make informed decisions. Services and processes should be heavily tech-enabled, but the human touch is still essential. Today’s insurance agency uses digital tools to deliver results and sell in minutes while providing a white glove experience to the consumers they serve.
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For agents and brokers who want to tap into this exciting era of insurtech, the first step is to evaluate their current business and product offerings, including what is selling, what their needs are, and where they can improve. For example, if an agent or broker sells a lot of homeowner’s policies, they should look for better products that may exist, if there is anything new they should consider, and how they can make improvements or changes. For insurtechs and carriers, it’s important to see that brokers and agents still have a powerful part in the industry and will continue to grow in influence over the years to come.
By Dustin Lemick, founder and CEO of the jewelry insurance provider BriteCo
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