Agency Marketing Technology

Creating and managing a small commercial department

With a little tweaking of procedures, small commercial accounts can become profitable

By Steve Anderson

The last couple of columns talked about how to most effectively market to the small commercial account. We are now going to turn our attention to effectively creating and managing a small commercial department to handle the servicing of these accounts.

It is one thing to bring new business in the door; it is another to be able to handle the day-to-day activities and transactions required to service that business. Because of the smaller revenue generated by these accounts, it is imperative that they be handled efficiently. This is harder than it seems on the surface because, in order to handle these accounts effectively, the agency needs to think differently about them. Some keys to success in setting up a specialized small commercial department include:

Picking the right accounts. Being able to effectively handle these types of accounts actually begins during the sale process. The agency needs to clearly understand what types of accounts will fit most effectively into its culture and processes. We spoke recently with an agent who is very selective about the types of accounts that the agency writes. Because the agency is highly automated and uses e-mail as its primary means of communication, it suggests to prospects that do not use e-mail that they find another agency to handle their business. The agency turns away business that does not fit into its culture and processes.

Another agency requires that the accounts it writes be handled by a carrier service center. The producer clearly explains during the sales process that this is how the account will be handled for any servicing needs. Clear expectations are set with the prospect regarding what this will mean. If the prospect balks at having its service needs handled this way, the producer suggests that it find another agency to handle its business.

When the agency establishes clear service guidelines and communicates those expectations to the prospect, a foundation is created for a solid, ongoing relationship. An agency can no longer afford to write just any type of account. Picking the right accounts for the agency goes a long way toward helping the agency make money writing small accounts.

Pick the right people. Another key to success is having the right people in place to handle small accounts. This may require a different type of CSR than the agency currently has handling other types and sizes of accounts. The CSRs need to be willing to sell additional coverages as they talk to their clients. They also need to be able to ask for referrals. This may be hard for some CSRs because often they believe that they are service people, not sales people. In order to find the right person for this position, you may need to look outside the agency and hire someone who possesses these attributes.

Small commercial CSRs must also be comfortable with and enjoy technology. They should like using the computer and be willing to experiment with new ways of streamlining old processes and procedures. They should be willing to try new things and always ask the question: “What can we do to streamline how we are handling this business?”

Small-business CSRs also must be open to various servicing options, including using an agency service center, Web-based servicing, and/or carrier service centers. To be efficient, they need to be willing to pass off the service request to one of the above options. For many CSRs this may be hard to do, because they believe “that is my job.”

Complete automation. Fully utilizing the automation resources available to the agency is especially important when handling small commercial accounts. Complete automation includes full utilization of the agency management system, a document management system for handling all electronic documents, a fully completed client and policy database, and automated procedures for converting all nonstandard forms into an electronic format, to name just a few.

You can’t overemphasize the importance of having all the information on an account captured within the agency management system. That data must be correct, complete, and consistent if your staff is going to rely on it to service these accounts.

Correct: If your staff is going to rely on the information within the agency management system, it must be the correct information. Otherwise, they will look to other sources of information to be able to answer client questions. This is one reason why establishing good procedures is important. Your agency management system does a good job of capturing rating and underwriting information. It provides you with policy information, limits, and other information that is necessary for you to manage the policy. But the information will be useful only if it’s correct.

Complete: In too many agencies, staff enters information in the system in a variety of ways. When we do a technology audit for an agency, we often see staff members completing the database as they see fit, rather than as the agency standards mandate. We also hear that staff does not enter all the information on an account because “it takes too long.” Fully completing the information does take time. However, the time saved by being able later to use that data in multiple places should outweigh the time used to initially enter that data.

Consistent: Data must be entered into the database the same way each time. Procedures must be in place so that everyone understands what information goes into which field. Having consistent data is the only way different individuals can work on the same account and trust that the information they are looking at is accurate and complete.

Streamlined procedures. Although we have already mentioned the importance of streamlined procedures, their importance cannot be overemphasized. Every single step currently done in the processing of small commercial account business must be scrutinized to determine if it should continue to be done the same way. You always should be asking if there is a better, more efficient way to handle the transaction.

For example, you may decide that you cannot afford to remarket small commercial accounts every year to all the carriers that you have available. So your procedure could be to only review the account, to see if it needs to be remarketed once every three years. The downside is that the account might move because it received a better price for coverage elsewhere. You may need to let that account leave. The reduction in your internal expense of handling the remarketing may more than make up for the few that will leave.

We are convinced that any size agency can make money handling small commercial accounts. But in order to do so, it must completely rethink how to handle this class of business. An agency that is willing to make the necessary changes will discover that small commercial accounts can be a growing source of revenue. *