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Adapting your insurance agency for the future

In the 90s, Progressive came out with a mandate that they’d focus on marketing to 19 year olds.   While that seemed foolish at the time.  Progressive now has the best online system in the industry.   At the same time, they are the only insurance company that allows an insurance agent the ability to sell, and service policies on all platforms including Apple’s IOS and Android.  While older insurance agents stick to their traditional guns, the world and technology continues passing these veteran insurance agents by; leaving their agencies and websites to be dominated by young agents like me.   Positioning your agency and it’s technology for the future is more important than ever.

Recently, I read an article in Property Casualty 360 regarding older agents trying to adapt to new technologies.  The article describes an aging independent agent industry struggling to cope with changes to technology.  Simply put, the speed of life has caught up with  the Independent Insurance Agents and Brokers of America; and passed these guys by.

These articles amaze me.  In the past, insurance agents heavily relied the broken retail business model while companies like Geico, Esurance, and 21 Century commoditized personal line and built large distribution systems that survive regardless of the independent insurance agent.  Working as a  Geico supervisor in the 90s,  I took literally hundreds of calls from independent agents testing my representatives and threatening complaints with their local state insurance departments.   Keep in mind, companies like Geico have deep pockets and extremely profitable books of business.  They consider an investment in technology as an investment in the future.  Instead of fighting the Geicos of the world, agents should have been focusing on adapting to emerging technologies; and becoming the best independent agent in the business.

Now, that technology is no longer emerging. In fact, technology has caught the independent agent world  with their proverbial pants down surprised by how quickly technology is making the personal lines insurance agent obsolete.  As a result, relatively new independent agents like me, come into the business asking very difficult questions with regards to things like search engine optimization, social media, blogging, and more.
Remaining relevant in today’s market requires a little thinking outside the box.  However, keeping an open mind is paramount!  New agents have new solutions to new problems.  Having clients visit your office will go by the wayside; just like the “made in the USA” label on consumer goods.    As an independent agent with less than 10 years on the independent side of the business,  I hear many of the following statements when we discuss their marketing plans:
  • “My clients aren’t on the internet.” – If my 83 year old grandfather uses Skype, and email, you can too.  Keep in mind that if facebook were a country it would be the 3rd largest country on the planet with over 900 million monthly active users.  What makes you think your client is SOOOO different from the rest of the planet?
  • “Only start-ups shop for business insurance on the internet.” – Seriously? this isn’t a reason.  It’s an excuse.  I’ve heard that excuse for three years.  The same business clients they disliked 3 years ago, now have 3 or 4 policies with my agency.
  • “My clients are too old for facebook.” – Maybe your insurance clients aren’t on facebook, but are they on LinkedIn, Twitter, Skype, Google+, or others?  Moving forward, agents and agencies need publishing platforms (websites) that communicate with the popular platforms.  Not only will my dedicated RSS subscribers read this blog post, but my entire social network will read this; not to mention all of you who searched this topic.
Property Casualty 360 makes the analogy pre-90s travel agent.  When American Airlines went to a flat fee compensation plan around 1993, travel agents thought they could simply avoid or boycott companies like these.  Ultimately, these types of compensation plans became the norm.  Will this happen to auto and homeowners insurance?  It’s possible.  Call centers and automation may one day completely replace the auto and home insurance guy.   The day of the client coming to your office to review his policy(ies) will soon be replaced by skype, desktop sharing, join.me, google+, and other disruptive technologies.
Education and innovation has become more important than ever.  The key to continuously growing today is to completely embrace technology and become more educated and specialize in industries that you don’t see on television.  Insurance agents will need to look to different forms of business insurance and specialty insurance markets to remain competitive and profitable moving forward.
So where do you stand with your insurance agency?  Are you like me?  Do you take a technology first approach to ensure that you stay ahead of the competition?  Are you like the many retail agencies dying for business because their clients are searching the internet from their pads and their smart phones.
One day in the near future, the majority of insurance shoppers will go to the internet first.   Smart Phones, Tablets, Facebook, LinkedIn, Twitter, and SEO will one day replace the chamber of commerce, meetup groups, and BNI groups.  Where will you be positioned when this occurs?  I’d love to hear from you.  By the way, if you like this post, click the +1 button and share this with a friend.

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