In spite of the fact that more consumers are using mobile to shop for insurance and perform transactions, the independent agent retains an important role in the sales and customer experience management process.
And, insurers know that the independent agent channel is still a key determinate of an insurer’s success. However, challenges still remain for insurers to make it as easy as possible for an agent to do business with them and their collective customers. This challenge is complicated by an insurer’s business objectives; when moving into new markets or launching new lines of business, they require flexible technology that will foster growth.
Size of carrier also seems to matter. According to a 2016 JD Power study, this year marks the first time in the past 6 years that small insurers achieve a higher customer satisfaction score than their larger competitors (815 vs. 814, respectively).
Increased positive perceptions of premium price helped drive the differing performances between the two groups, as the price factor is the largest advantage small insurers have over large insurers, notes JD Power.
“Price perception among customers of smaller insurers is likely influenced by the fact that they frequently select their insurer with the help of an independent agent,” said Greg Hoeg, vice president of the U.S. insurance operations at J.D. Power. “Smaller insurers benefit from the personal interactions provided by their agency force, including their ability to educate customers about the value their policy provides.”
Although larger insurers may have more resources to invest in improving their customers’ ability to conduct business online, interaction, one of the five factors measured in the study, was one of the primary drivers of the overall decline in customer satisfaction. Lower levels of satisfaction with the local agent (down 7 points to 864) and call center representative (down 6 points to 839) drive the decline in satisfaction in the interaction factor.
Further, the study notes a decline in satisfaction with policy offerings (down by 8 points to 809), “due in part to insurers’ failure to make it easy for customers to work with them,” notes the report.
These results are a wake-up call for insurers of all sizes trying to better engage their customers via their agent channel.
For P&C insurers looking to improve the customer experience for their distribution network, ease of doing business and robust omni-channel capabilities remain top priorities, notes a recent report from research and consulting firm Novarica.
“Agent portal investment has continued to remain high on the priority list for insurers, though in recent years that has expanded to include a more multi-channel approach, including increased focus on policyholder portals, direct agency integration, and mobile applications,” said Jeff Goldberg, Vice President of Research and Consulting at Novarica.
One case in point: When The Philadelphia Contributionship (TPC), the oldest property and casualty insurance company in the United States, decided to replace its 30-year-old legacy system, the company focused making future-ready its front-facing agent system that sat on top of that legacy platform.
According to a published success story, the 1980s type of technology TPC had was no longer viable for the long run. After a couple of failed attempts at implementing a new system, the Mid-Atlantic provider of homeowners, fire and liability insurance decided on SurePower Innovation, a modern enterprise suite of applications from ISCS, a developer of cloud-based, core administration software solutions for property and casualty (P&C) insurance organizations.
Getting agents on-board was a high point, especially in light of the fact that the company was entering a new state, Maryland, which meant establishing new relationships with agents. TPC involved its agent customers very early in the process, through site visits and access to the test system.
Agent feedback has been positive, especially on feature/functionality related to being able to work in one platform with one common user interface, faster, more intuitive quoting, the reduction of rekeying tied to different premium thresholds and overall improved communication capabilities.
“The expansion of agent portal capabilities is crucial to modern distribution support,” notes Chuck Ruzicka, Novarica’s vice president of Research and Consulting and co-author of the report. “As agents and their respective carriers struggle to stay relevant in the rapidly evolving world of digital insurance transformation, portal capabilities become even more critical.”