AGENCY MARKETING TECHNOLOGY
More sophisticated technologies don't necessarily
make business life less complicated
By Steve Anderson
Properly used, technology should make agents' lives and their customers' lives easier.
The introduction of new technology does not always mean that we should adopt and use that technology. It has been said many times that in independent agencies the technology drives the business instead of the business driving the technology. Agency owners and managers must understand that business issues should drive the use of technology, not the other way around.
When agents first started purchasing computers in the '70s and '80s, insurance companies developed proprietary software for them to use. First to be developed, rating software provided agents with the ability to rate a policy without having to go to a rate manual or to a company underwriter. In the beginning, this helped shorten the amount of time it took an agency to provide a quote to a prospect. In addition to software, carriers also added interactive rating, where agents could connect to the company system using a dial-up modem and thus were able to rate and issue policies directly.
Both of these options provided some improvement over the manual process--in terms of time saved by the agency and in terms of customer satisfaction. Problems started showing up, however, because independent agencies represent multiple carriers. With each carrier installing its own "proprietary" computer or software system in the agency, the "benefit" quickly became a burden. To get a comparative rate, the CSR would have to go to each carrier's computer and do the same work multiple times. Agents began complaining about carrier "proprietary systems" because of the additional work required. And they were right. The interruption in agency workflow that these systems created began to make using them more hassle than they were worth.
History repeats itself because similar arguments are surfacing about how the adoption of new technology is impacting the internal operations of an agency. The agent's need for a more "workflow friendly" system undergirds the drive to find a way to share the same information with whoever needs it. Here are a couple of areas where the "new old" problem shows up.
Carrier Web Sites: Insurance carriers are rapidly developing applications that allow agents to use the Internet to rate, check direct bill status, and access a large amount of other information. Carriers are moving existing applications to the Web as fast as they can and at the same time are developing new Web-based applications. It makes sense that they should. Internet technology allows carriers to develop their products faster, deploy them less expensively, and provide better functionality to agents. The applications that agents are using, however, are not standard. Each carrier builds what it thinks its agents want and need. The end result is the creation of different, and often conflicting, workflows for agency staff. In fact, what was designed to save the agent time too often creates additional workflow steps that take longer to complete.
Credit Scoring: Current technology makes it possible to find out almost anything about anyone. Many insurance technology companies have improved the process of obtaining and verifying information about prospects. A presentation at a recent ACORD conference demonstrated how an agent could provide a binding quote for personal auto coverage using only a person's phone number to access and cross-reference various databases. This process provided enough information to provide a quote.
Many insurance companies are using credit scoring as an underwriting tool in order to more accurately classify the risk potential of a particular prospect. The problem is that the workflow issues the agency faces may make credit scoring an unacceptable process to take on. Some of the problems include: having to explain to a prospect why he or she did not qualify for the best rate because of a low credit score, the impact of multiple entities requesting information from the credit report and thus negatively impacting the score because of the higher activity on the account, and determining when you request the credit score--when you are putting together the proposal or after the prospect wants the policy issued. If you decide on after the quote is accepted and the credit score creates a higher rate, how do you go back and explain the change to your new client?
Obtaining MVR and CLUE reports is very similar to asking for credit scores but is somewhat less sensitive for the prospect. The question remains, when do you retrieve the actual MVR and how do you present its implications to the prospect?
Insurance companies have increased their use of the Internet and Web sites to provide agents with access to carrier information. Database technology has been improved so that we now have greater access to information about our prospects than we ever had in the past. But are the improvements making the lives of agents and their customers better? Properly used, technology should make agents' lives and their customers' lives easier. We all need to push automation vendors, insurance carriers, associations, and user groups to make sure that technology actually helps the customer. Only then will we be able to compete successfully in the future. *
The author
Steve Anderson has been a licensed insurance agent for more than 20 years. He is president of steveanderson.com, Inc., which provides products and services that help agents maximize profits using commonsense technology. He can be reached by e-mail at steve@SteveAnderson.com or by phone at (615) 599-0085. For more information, visit his Web site (www.steveanderson.com).