This year, agents are really starting to benefit fromtechnology. But with powerful tools available to fill so manyneeds, brokers face a challenge to know where to deploy theirlimited technology capital to get the best return–marketing,internal effectiveness or stronger carrier relationships.

“I think there's been a realization that using technology togain an advantage has moved from 'nice to do' to 'necessary to do'to be in your strongest competitive position,” said Jeffrey Yates,executive director of the Agents Council on Technology (ACT), partof the Independent Insurance Agents and Brokers of America(IIABA).

Here's a taste of some of the technologies that are making animpact on agencies this year.

Marketing 2.0

More agencies have begun making technology central to theirsales and marketing efforts to bring in new business and to helpestablish reputation, loyalty and relationships that help retainthese accounts.

“Social media has absolutely exploded this year,” said KarlynCarnahan, principal at New York-based consulting firm Novarica. Inearly 2010, she found 40 to 60 agents were producing the140-character messages on Twitter; 3 months later, it was closer to600. Agents are using Twitter and Facebook to build a personalconnection, and Linkedin for networking (see “The move to socialmedia” below.”

Related:Read Rick Gilman's column, “A penny for your blog?”

Social networking also has allowed agencies to cut back on theirprint advertising and even eliminate Yellow Pages advertising. Oneagency, for example, has substituted these traditional methods with“my time, my energy, my information and knowledge” on socialnetworking sites, said Linda Rey, broker at The Rey InsuranceAgency, Sleepy Hollow, N.Y. In early May, she was working on aboutsix inquiries through social media, had booked an auto policy forsomeone who found her on Twitter, and had written a retirementaccount from a Facebook acquaintance.

Service

“We're watching very closely the growing need for agents andbrokers to be more customer-service oriented,” said KimHarris-Ferrante, vice president at technology researcher GartnerInc.'s North Carolina location. Carriers are exposing moreinformation through self-service Internet sites and intermediariesare assuming the role of a complex customer service administratorfor requests that don't require face-to-face interaction.

Related: Read last year's Agency Technology story andcompare! Read “The war on keystrokes.”

Applied Systems CEO James Kellner agrees, explaining service isbecoming even a bigger driver in agency technology adoption asbrokers strive to win and keep customers.

Because “our customers want self-service for their customers24/7,” Applied Systems' Epic system includes features likedistribution management to send information by phone, e-mail orlink–and eventually Facebook and LinkedIn, when there is enoughdemand–according to the preferences specified in the receiver'sprofile.

Some independent agents had turned away from personal lines,especially auto, leaving direct writers to handle the relativelylow-premium business; the right technology and businessrelationships, though, enable personal lines to be a profit center,not just a service line. Agent Mike Foy of Foy Insurance links hiswebsite to a rating service to compete directly with directwriters, “turning a $50 monthly investment into a $3,000 annualcommission.”

This is a “great tech tool that allows us to offer the samecompetitive advantage as a Geico or a Progressive,” Foy said.

Foy's success with this has taken time. He tried to writebusiness this way 7 years ago, but the resulting rate a customerwould see “wasn't accurate enough, and I think being somewhat closeis important,” he said. Comparative raters continued to evolve andhe tried again, but this time the service was hidden on his websiteand prospects were unaware of it and didn't use it. He's nowactively promoting this capability by prominently featuring it onhis website and by driving potential clients there with variousmeasures including advertising in the online businessdirectories.

Collaboration

Real-time download offers huge benefits to agents and theircarrier partners. A major industry effort by ACT, ACORD, ACORD-UserGroups Information Exchange (AUGIE) and other industry groupscontinues to encourage agents to use it and carriers to build outconsistent functionality to make it a more powerful tool, Yatessaid.

In the most recent AUGIE survey, completed by 4,000 agents,brokers and wholesalers in January, 69 percent of respondents wereconducting real-time inquiries like looking up bills and makingpayments, Yates said. Policy-view usage grows about 20 each year.The survey also showed about 65 percent of respondents saw asignificant increase in agency value from adoption of the latesttechnologies.

Related: Read “Real time makes its mark.”

One recent addition to collaborative technology is the FirstBestagency portal.

California-based ICW Group, a midsize or “super regionalcarrier,” realized a 92 percent lift in workers' compensationsubmissions received from agents in 2009 compared with the previousyear. This is due in part to its deploying the FirstBest UMS(underwriting management system), which ICW Group has branded“Snap.” For the same period, ICW Group's quote count was up 80percent and policy count was up 41 percent.

“Snap's ability to process more business more efficiently hasbeen a significant factor in achieving these results,” said ICWGroup's director of marketing Gary Whitfield. Agents areparticularly pleased with Snap's upload feature, which allows themto instantly populate more than 70 percent of their applicationsubmission by pulling data directly from their agency managementsystem. “A single keystroke replaces what traditionally has been avery time-consuming process of rekeying required information fromthe ACORD application,” he said.

But even agents who have not upgraded to a recent managementsystem can benefit from the accelerated turnaround the portaloffers. Joan McLaughlin, commercial lines and marketing manager atIndustrial Risk and Insurance Services in Santa Ana, Calif., usesSnap to place about 99 percent of the business she does with ICWGroup because the technology allows her to instantaneouslyprequalify a piece of business and to complete a new businesssubmission–including scanned attachments–in about 10 minutes. Also,competition makes it important for an agency to be credited as thefirst to bring a particular account to a carrier, and the systemallows her to reserve an account 92 days before the expirationdate, “giving me the control I need,” McLaughlin said.

To date, the carrier has deployed the portal technology to about250 agencies, and 69 percent of its business comes in through itsSnap portal, Whitfield said.

Also on the collaboration front, the electronic insuranceexchange that over the years has been on the drawing board invarious iterations and arrangements, finally seems poised fortakeoff. Now called the Lexis-Nexus Insurance Exchange, and ownedsolely by the information aggregator with oversight and involvementby key industry groups, it has scheduled a limited implementationin mid-October. Initially, there will be 16 to 20 early adopters,including Brown & Brown, BB&T, Van Gilder, MHBT, M3 andRCM&D, so it can be carefully monitored. If all goes asplanned, it should be open to general use by mid- to-late 2011,according to Frank Sentner, director of strategic technology forthe Council of Independent Agents and executive director of theInsurance Exchange Trust, which oversees the exchange.

“This has been, and will continue to be, an intermediary-driveninitiative,” Sentner said. “We need to validate for carriers thatthere is sufficient interest from broker partners to justify theirinvestment.”

Nevertheless, Applied Systems' Kellner remains skeptical thatthis Exchange will succeed, questioning the need for anintermediary to deliver transactions and noting “there have beenall sorts of different attempts to aggregate to a third party” thathave not succeeded. Nevertheless, Applied Systems products would beable to support it.

Internal productivity

Beyond the bottom line, technology has changed the whole conceptof how and where work is done, and that requires continuousupgrading of technology to allow for a mobile workforce. Smartphones can work remotely, enabling agents to handle questionsanywhere. Mobile applications allow work to be done in an airportor a client's office.

Another consideration is employee retention. Agency demographicsare changing and young people enter the industry without the samesecurity or privacy fears and without the patience to deal withcomplex workflows, especially rekeying multiple submissions. Forthem, mobility and streamlined workflow processes are vital inchoosing a career in an insurance agency, Harris-Ferrante said.

One of the long-held promises of technology is the paperlessoffice. In 2009, the push was to go paperless to stop expensivemailing. In 2010, it's considered a way to “go green,” to bookbusiness faster so the customer has no time to look elsewhere andfor agencies to receive commissions more quickly. But despite thedesire for streamlined workflow and clear desks, only a smallpercentage of agents have gone beyond transactional or data filingto reduce paper transmission and really make this work for them,Harris-Ferrante said. An exception is the Chas. H. Bilz InsuranceAgency in Covington, Ky., which won the 2010 NetVu AutomationExcellence Award for going paperless on its AMS 360 and AfWsystems. The agency started with personal lines, then moved tocommercial lines seven years ago. The agency now files everythingfrom its personnel manual to the company memos that were oncepassed with a buckslip from desk to desk, all either appended to anaccount or indexed so it can by searched and found, said DianeBooth, vice president of operations. Benefits include time cut toreconcile direct bill commissions, freedom from stacks of files anda new hire working several states away. The remaining problem:built-in file cabinets, relics of another time, can't beremoved.

When Joseph Totah started Joseph Total Insurance Services inBurlingame, Calif. in early 2002, he scanned every document in PDFformat, named it and appended it to the client file in his Nexsureagency management system. “It wasn't perfect, but it was betterthan the alternative of saving files,” he said. When he sold hisbusiness six months ago, “there was not one file I had to hand overto the buyer agency…. It was a matter of giving the buying agency auser name and password to my online management system,” Totahsaid.

Despite the benefits, technology can only be adopted as fast asan agency can afford. “My investments have to have a return,” Foysaid. “I can't spend 20 hours of IT time to save 20 hours of anemployee's time.”