Being a good broker alone won’t set you up for success in today’s insurance market and industry insiders need to be competing with more than just their counterparts to win out, the CEO of an insurance business has said.
The industry is approaching an inflection point, according to Mitch Insurance CEO Adam Mitchell (pictured), who called for market participants to look to be more than good brokers and become great businesses too.
“You used to be able to run a good brokerage just by being a good broker and I’d say those days are either done or coming to an end,” Mitchell told Insurance Business. “To be a great insurance brokerage, you now need to run a great business.”
Mitch saw growth, entirely organic, of “around 30%” in 2022 according to the CEO and has grown from being a $2.5 million premium broker when Mitchell took the reins to servicing around $65 million in premium today.
As a third-generation insurance broker himself, Mitchell took over the firm (then Mitchell & Whale) in 2008. However, he had strong words for the next generation of insurance leaders, including those who have inherited their businesses, who he said could be left behind if they aren’t prepared to step up and look outside their bubbles.
“I think we’re in a very transitional period where nepotism has passed a bunch of these businesses down from hand to hand and there’s big barriers to entry, so you haven’t been able to get in,” he said.
“And now the ones that are really succeeding, are acting and operating like really successful businesses.
“I’d love to see more high-quality CEOs and CFOs, and analysts and operators, running these brokerages like great businesses, not like Canadian insurance brokerages.”
While “great brokers and great brokering” remain a must, according to Mitchell, it is imperative that businesses keep their eyes trained on wider developments and trends and look to compete at a higher level.
“I don’t want to besmirch the owner-operator idea, but it’s that idea of if you’re a three person shop, not only do you now have critical mass problems where you don’t have the dollars to invest and whatnot, if you’re busy working in the business, and your competitor is working on their business, you’re not going to be able to match them for very long,” Mitchell said.
“I’d like to hope that people will continue to benchmark themselves not just against their industry peers, but against other great businesses.”
For Mitchell, this could involve keeping abreast of what classic non-competitors in other markets are doing well, and considering how you could be better than them.
“If you hear Shopify doing good things, how do you race them?” he said. “Who cares if you won your high school shotput? … How do you benchmark up? It’s that elevation.”
The drive to compete on a greater scale and remain relevant with the buyer of today has seen Mitch build 78 markets into its platform. The business may rack up leads online, but for Mitchell there is a key distinction between Mitch and other consumer aggregation platforms, though they can end up “fighting over the same pile of fish”.
“We generate the demand for ourselves and we fulfill demand, so we would have significant traffic that converts into leads and then gives us the opportunity to sell, and then we place and broker the business,” Mitchell said.
“The entire ecosystem is: You find strangers online looking for [insurance], you convert a stranger into a client, you hand them to the customer service and try and retain it – that’s our circle of life.”
Mitch, under Mitchell, has ambitions to be a top-20 national brokerage by 2030 when it hopes to oversee $1 billion in gross written premiums. In 2022, it was named one of Canada’s Top Growing Companies by the Globe and Mail.
As to whether his firm’s digital drive means he is taking an insurtech approach, Mitchell said: “There’s only two parties that call something insurtech: It’s a party on the outside that doesn’t recognize it – so ‘that’s a digital broker or insurtech’ – or it’s somebody that’s wearing that hat trying to raise money and it’s like a mystifying magical thing.
“At the end of the day, we only do two things: We sell new policies to new customers, and we renew old ones to others.”
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