What role should technology play in insurance?
The answer to this question varies depending on who you ask. Insurtech innovators might say that every process in the industry is ripe for atomization and digitization. Customers might ask for easy ways to reach their agent and access their policy information online.
But when I talk to leaders at independent insurance agencies, most of them just want their sales staff freed up to sell insurance and their service staff freed up to provide good service. Many are overwhelmed by the abundance of new tech options and are wary of getting caught up in “shiny object syndrome.”
Forward-thinking agencies know that digital tools can help them achieve their goals. According to Liberty Mutual and Safeco Insurance’s 2022 Agency Growth Study, agencies that aim for aggressive growth are using digital at higher rates than other agencies.
But these agencies are also pulling other growth levers. They know that technology enables strategy, but technology itself is not a strategy.
In my work with the Agents Council for Technology (ACT), I encourage agency leaders to get clear on the fundamentals of their strategy before implementing new technology. I advise a leaders to think through what type of agency they want to be and what types of employees and clients they want to attract. Then, they can find the technology that will help them get there and differentiate them in the market.
Here are a few of the areas where I see agencies strategically using technology:
Use technology where humans don’t add value
Technology can streamline repetitive processes that eat up time that could be better used elsewhere.
For example, having a staff member enter a client’s data into a form for the fourth time doesn’t enhance your agency’s relationship with the client. Using a tech tool for data entry can free up that staff member’s time so they can spend more time prospecting or interacting with clients.
This may mean implementing technology that isn’t the most romantic or shiny. Some of the insurtech companies I’m most excited about are developing systems to leverage publicly available third-party data to help agents do things such as quickly and easily get dec page data for a client.
Using technology this way lets you emphasize the areas where humans do add value – like building relationships with potential clients or talking a client through the claims process.
Use technology to meet customer expectations and make things easy for customers
My son recently turned 18 and I was able to easily take care of auto policy updates with my agent via text. My agent is a personal friend, and I value our relationship and his personalized advice, but I really appreciated the convenience of being able to make the changes on my phone rather than have to go in for a meeting or schedule a phone call.
I’m not alone. Most customers expect to be able to interact with businesses through digital channels. According to Salesforce, 61% of customer interactions with companies in 2022 happened online, compared to 42% in 2019. And 65% of millennial and Gen Z customers prefer to engage through digital channels.
What types of interactions do your clients want, and what types of clients do you want to attract? The answers to these questions can help you clarify which technology tools to invest in.
Use technology for employee flexibility
The pandemic prompted many agencies to rethink their expectations for where and when employees work, and workplace flexibility is an ongoing conversation.
I’ve found that large agencies are more likely to embrace remote work, while small agencies are more likely to say they do better in-person. Some agencies want a mix of remote days and in-person days. Others simply want to offer the flexibility for people to do their job how, when and where they want.
Every approach has its benefits and drawbacks, so agency leaders first must decide how much flexibility they want to provide. Then they can invest in technology to enable that flexibility – such as laptops, VPNs, virtual meeting platforms, tools to track productivity and more.
Start with strategy
There’s no one-size fits all approach to technology in independent insurance agencies. Agencies may need vastly different technology tools depending on how they want to do business. The key is to lead with strategy and let that inform technology decisions.
Used strategically, technology tools can help your agency provide flexibility for employees, make things easier for customers, emphasize the areas where humans add value, and more. By making strategic choices to meet your agency’s goals, you’ll set your agency up for continued success.