Agents want transactions to happen fast and easy, and customerswant the same thing. This can only be achieved with sophisticatedtech solutions that open the flow of information, increase channelsof distriution, automates processes, speeds up transactions, andoffer real-time analytics.

Distribution modernization is here and has long been managed asan afterthought or necessary evil. Insurers have often viewed it asa back-office function that delivers little value. But with theconvergent of big data, social media and technology, distributionmodernization is not only important, it forges a path to futuresales success.

In a white paper, Vue Software details fivethings that enterprises need to know about distributionmodernization.

Distribution Modernization and the FrontOffice

In non-insurance organizations, the revenue-generating side oftheir value chains are defined as a separate function–frontoffice–and technology supports the production of revenue. But atinsurance companies, the value chain usually begins withunderwriting. Insurers must bring management, suppliers,wholesalers, sales executives ane customer service together to asingle function with unifying technology that manages distributionin its entirety, Vue Software states in its white paper.

By doing so, insurers will realize immediate payoffs:

• A single managerial focus on revenue-related processes
• Improved imformation to support and service agents
• Alignment between sales growth and the recruitment of newagents/agencies
• A centralized serve points that ensures accuracy in agentcompensation
• Agent access to complete information on customers, products,renewals, sales goals, compensation, compliance and results.

Next slide: Societal changes

Keeping Up with SocietyChanges and Trends

Modernizing distribution is more than just consolidatingfunctions, it enables new technology access to integrated socialmedia and access and use of big data.

Insurers must respond to changing regulations and demographics.The influx of the immigrant populations prompt the need formultilingual agents and service representatives. Aging andmillennial populations requre specific products and promptmarketing and serice challenges since their buying and behavior isdifferent.

One of the largest societal changes is the availability of dataand information that is accurate and relatively inexpensive. Bigdata can be the paradigm shift for the entire insurance industry,Vue Software writes. “If an insurance company cannot comprehend thepower that resides in Big Data that company will face a prolongeduphill battle to compete in the marketplace.

Next slide: Social media

Social Media and DistributionModernization

The Big I's Young Agent Council reports that more than 60% ofits members have Facebook pages, and use Twitter and other forms ofsocial media on a daily basis. Vue Software writes that Facebook isa legimate tool in the marekting and servicing of insurance.

Financial services marketing pays attention to life events: if aclient is getting married, there is an opportunity to provideservice and product to that client. Property and casualty insurerscan use a similiar approach. With businesses, large and small, onsocial media, the ability for the agent to access information abouta client's business is no different than the life event approach.Does the businesses post that it is expanding or taking on morespace, acquiring a new business, entering a new line? These areopenings for the agent to provide insurance and risk managementinformation.

The challenge managing information that comes from social mediafrom 1,000 or so clients. Aggregating services, such as HearsaySocial, can take a client list and manage keyword searches toupdate which clients and prospects posted something of interest ona particular day.

Next slide: Onboarding new agents

Onboarding of New Agents andAdvisors

The processes for agent recruitment and onboarding can fallunder field mareketing, underwriting or agency management.Regardless, the purpose of this part of the front office is toenable new agencies to join a carrier and represent its insuranceproducts. Generally, the process begins with “someone” sending aprospective agent an email with a contract and datasearch.

How will the new producer recognize that they are joining afirst-class organization? Technology plays a role: Are backgroundchecks electronic, what about contract handling using e-documentsand signatures? Are fees handled by credit card?

After onboarding is completed, is the scheduling of training,delivery of marketing and training materials and educationprofessional? A carrier that is dedicated to improving its salesforce understands that first impressions are important. Anautomated onboarding process validates an agent's decision torepresent the carrier and provides metrics that measure and monitorappointment status and performance.

Modern systems must allow an agent to access information fromthe carrier via multiple devices. A portal delivers the agentup-to-date information and gives the opportunity to self serve.Agents need to access expiration lists, renewal information, claimsand underwriting statues, client contacts, client profiles,commission information and recent customer activity.

Next slide: Oversight andmanagement

Clear Oversight andManagement

A formal and structured front office provides better managementoversight of the entire revenue side of the business, consolidatesdisparate departments and delivers improved service to agents, VueSoftware writes. Modernizing distribution is a challengebecause insurance professionals remain loyal to legacy systems andthe status quo.

But long gone are the days of simple commission tables. Whilemuch of the P&C carriers base commissions on a simplepercentage of the premium, that percentage can vary by class ortype of business. Contingents are algorithm based, and agents noton the same plan makes managing hundreds of different contingentarrangements a daunting task.

Modernization's crowning achievement is its ability to usemyriad data that is captured in the front office and store it in abusiness intelligence context.