Insurance is a billion dollar industry so it only makes sense that there are people out there, besides insurance agents, that lay awake at night trying to figure out how to redirect some of its revenue flow in their direction. Of course, when any business is compensated through insurance policy commissions or fees, that business is considered an "insurance agency." Well, the face of the "insurance agency" is changing.
When a technology company disrupts insurance, the agency ends up being run like a software company. The experience is eye-opening. Check this out...
Insurance is not a specific function in the agency. Traditional insurance agencies generally split functions between insurance and operations (everything non-insurance that it takes to run the business). The tech-disrupter insurance model splits functions between new customer acquisition and operations (everything other than sales). In other words, the sale (getting customers in the door) is king...that's where the frat house mentality is often most prevalent. It's a very numbers-driven model. There are bonuses based on the number of calls and number of demos per day. I say "customer" because I don't think they really view them as clients. Service is handled with a sort of "call center" mentality where service representatives rarely work with a specific client for more than one renewal.
They don't talk about insurance until after the sale. Since new customer acquisitions are focused on selling a cool technology platform that saves time and money, insurance is typically not discussed until after the sale is made and the Broker of Record letter is filed. Insurance service, including the entire renewal process, is considered a part of operations (a customer service function verses relationship-driven professional insurance advocacy).
And they don't personally meet with clients. In person, face-to-face client meetings are not allowed even upon customer request. Presentations, training and discussions are all conducted by phone or virtual online meeting only.
The question is whether these differences are positive or negative? The sales emphasis is certainly growing new business faster than the traditional agency model. Virtual meetings and "call center" type service would appear to be cost effective, but do they highly satisfy customers? The one thing I am sure about is that a critical focus of any insurance agency must be professional insurance expertise and advocacy...even if consumers don't find it fun to talk about. Wrapping insurance in cool technology that makes consumers more competitive and profitable is brilliant! Offering it for free with the purchase of insurance is irresistible!
Lynne Wallace is the CEO and president of VANTREO Insurance Brokerage and co-founder of NDOI, the National Directory of Insurance.
