The good news: this 56-year-old insurance veteran can’t envision a future where the broker is replaced by a robot.
Ron Berg, executive director of the Agents Council for Technology at the Independent Insurance Agents & Brokers of America, spoke with
Insurance Business about the threats and opportunities facing the insurance industry today and in the future.
Berg, a Minnesotan, has a 20-plus year history advising on future technology strategies and has long been involved in various industry associations and workgroups in technology in insurance.
What are the major technological threats facing the insurance industry today (and in the future) in the widest sense?
I think for today, it’s really providing the customer experience that consumers everywhere are demanding. Amplifying this, everyone is seeing the ease-of-use interactions created by the insurtechs and other emerging platforms. As a distribution we haven’t kept pace, and customers see the evidence of this. We have excellent examples provided by these new entrants, and if we are able to learn from the best practices among these, implement – from carrier, vendor, and agency implementations – we can improve the best distribution and support platform in insurance.
What are the major threats facing brokers and agents today (and in the future)?
The changing workforce is having a huge impact. Agents and brokers need to attract and retain younger talent, but we have created the perception of a stale, unappealing industry. This couldn’t be less true, however – the quantity and variety of challenging and good-paying jobs is a huge plus for the independent agent distribution. We simply must capitalize on this, using programs like InVEST. Another threat is simply the acceleration of technology trends and not only responding to them, but anticipating direction. Things like drone, telematics, Smart Homes, the Internet of Things, AI/machine learning, the sharing economy – we must be able to rapidly understand and execute on the top priorities. The good news is that we’re getting much better at this on the whole.
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Is artificial intelligence, as some commentators have suggested, the beginning of the end for brokers? Is it a dying profession?
I don’t believe AI will necessarily harken the end of the independent agents – particularly if we as a distribution learn and implement ‘best practices’ using AI and machine learning. Machine learning (chatbots, guided interactions) can complement and support strained agency staff – providing online support to incoming consumer requests, and directing responses to the correct agency representative. Agents can choose to implement solutions as deeply as they need, from the chatbots previously mentioned to more in-depth guided conversations. AI will have an impact on our distribution channel, but we can learn from it.
What tech developments do you see having the greatest positive impact on insurance?
A number of emerging technologies and processes are having a massive impact on insurers: the refinement and availability of advanced analytics and business intelligence (BI), artificial intelligence and machine learning, drones, geospatial analytics, telematics and usage-based insurance (UBI), autonomous driver-assisted vehicles reducing risk, and even things like 3D-printing. Many of these are greatly improving underwriting and actuarial processes, minimizing turnaround time, and making carriers more efficient.
How do you see the industry operating in, say, 10 years’ time? (From the way carriers sell to the way consumers buy).
I believe we’ll get to a place where consumers are not only searching and quoting online, but will be far more willing to purchase online – our distribution channel will need to respond to this, with insurers, technology providers and agents working seamlessly to a much greater degree. The advent of autonomous vehicles will ‘flatten’ the personal auto line, but with agents then needing to specialize, there will also come with that more complexity for the online consumer. Usable data will be far more prevalent for not just insurers and vendors, but also agents who can then make real-time strategic decisions. Real-time transactions will not just be an ‘ease-of-doing-business’ differentiator, but critical in almost every aspect for agencies to attract and retain business.
Related stories:
Threat, opportunity and disruption for the industry in 2017
The 4 biggest self-reported threats to independent agencies
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