Frank Petersmark, CIO advocate for X by 2, a softwarearchitecture consultancy, believes there is a natural frictionthere between agents and carriers when it comes to keying in data.From his days as a CIO at Amerisure, Petersmark recalls dealingwith agents that wanted the carrier to take care of as much of theprocessing as possible and unburden [the agents] of theresponsibility so they could just sell.

The reverse was absolutely true, remembersPetersmark, as the carriers want agents to perform thosetasks.

“Process and administration usually relates to expense,” saysPetersmark. “Carriers tried to push that process down the foodchain if they could to agencies. There has been a tug-of-war forthe past few years particularly as the recession hit. You had sortof a mad scramble of carriers and agencies to find ways to reduceexpenses so they could stay profitable. I don't think that worldhas come together just yet.”

Many carriers tout themselves as being easy to do business with,but Petersmark isn't ready to concede that ease of business issomehow more important than having the best price.

“Particularly among the midsize carriers, there was arecognition at least five years ago that part of the way theyretained business and built new business was by making themselveseasier to do business with,” he says. “We used to market ourselvesthat way when we went up against national carriers. Part of ourpitch was we were easier to do business with. That didn't just haveto be technology or automation, but personalized claims service,easier to get a hold of, and more responsiveness.”

Petersmark feels some large carriers—but certainly not all—havereacted to that strategy by working toward that same goal.

“I think [large carriers] have definitely moved in thatdirection, but not as quickly,” he says. “There are a couplecarriers that are arrogant enough to believe they don't have toworry about it because [premium decisions] are all about price tothem. If they return a good dividend every quarter it's all hunkydory.”

Smaller carriers and midsize carriers have learned to becomemore nimble in comparison to the larger carriers, which Petersmarkdescribes as the difference between trying to turn an aircraftcarrier and a destroyer.

“It's a little easier to turn the destroyer, but a lot ofmidsize companies have larger-company attitudes, cultures, andpersonalities,” he says. “You can't just snap your fingers, butthey still are able to get things moving quicker and that goesright to price. If they can drive down expenses internally and passsome of the process onto agencies then you can afford to be morecompetitive on price.”

Agency Systems

Petersmark believes the solution providers that market agencymanagement systems have made it easier to interface with carriers'systems, but the two sides remain far away from having a realintegrated Web platform that both carriers and agencies can use asa common repository.

“That's probably where this world needs to go, but the problemis a lot of the vendors still have a vested interest in sellingwhat they sell,” he says. “Some of the Web-based products make iteasier to interface, but carriers will still have portals and ifthe portals were built the right way you could do some relativelyseamless data population in both systems, but there still ended upbeing a fair amount of duplication.”

On the carrier side, many of the portal systems they developedultimately interface to legacy systems on the carrier's back-end,so the data is connected to the old policy system.

Seeking Help

As for the carriers offering assistance to their independentagents in the area of social media, whether the agency chooses toaccept that help usually depends on who is running the agency. Manyolder producers have no interest in that type of technology, evenfor marketing purposes, while others clamor for it.

Petersmark points out that agencies have to be aware of whattheir clients want and need, though.

“[Social media] is certainly more ubiquitous, but it can only goso far,” he says. “When you are dealing with mid- orlarge-commercial accounts and there is a lot of money at stake,social media is good for some quick marketing, but those retainedcustomers are not the target. Those are the clients you are goingto spend human time with to meet their needs so you make sure youget that half a million premium dollar next year.”

Mobile Technology

Many carriers are trying to figure out what to do with mobiletechnology and, not to Petersmark's surprise, carriers are beingforced to do that by their customers and their employees. “If youthink of the next generation of insurance customers,” he says.“They have almost an expectation that mobile apps will happen. Thetechnology exists to do that, it's just more processes withincarriers and agencies in figuring out how to apply that stuff.”