Different Agents, Same "Best" Standards
Honolulu
With 250 mostly new respondents to its Best Practices Study, the Independent Insurance Agents of America has found that the standards of agencies that rank among the best remain unchanged from prior years.
The annual study, released shortly before the IIAAs Hawaii InfoXchange, was put together with a new group of independent agencies, said Madelyn Flannagan, vice president of education and research. If the report says anything, it is that the things that make a successful agency have not changed, she said during an interview at the meeting.
This years study, to be used by agencies to determine if they are achieving the same standards as the best agencies in the study, has more questions concerning corporate structure, how agencies spend their time and technology.
Technology was also the subject of a second study released here by the Agents Council for Technology, called, "A Vision of the Future of Agency Technology."
That report is aimed not only at independent agents, but also at companies–to help them develop their technology strategies together over the long term, according to Jeff Yates, ACT executive director and Ed Higgins, ACT chairman.
The report, like ACT itself, is intended to benefit both agencies and companies–"building a bridge between two piers," Mr. Higgins said.
The work of ACT, a collaborative effort between companies, software vendors and the Alexandria, Va.-based IIAA, has been to get the three together to discuss their problems and identify obstacles to doing business together, Mr. Yates said. The report, he said, reflects not only on where agents and companies are and should be, but gives a strategy for where they should be in three years.
As for the Best Practices study, Ms. Flannagan said that this years report gives a finer breakdown of agencies by revenue size, adding analyses for the "$5-$10 million" and "greater than $10 million" revenue categories. Past reports only looked at agencies with more than $5 million in revenue, she said.
There is also a special section on personal lines business.
The report has anecdotal comments from agency respondents on what they do on some issues–such as hiring employees and producers–to make them as good as they are, Ms. Flannagan said.
Some of the reports findings are:
Most agencies provide access to the Internet to all of their employees.
AMS and Applied remain the most popular agency management systems, with the majority of agencies lowest and two highest revenue classes favoring AMS.
The number of valid life producers in property-casualty agencies was distinctly different based on the revenue classes. In the three classes with revenues less than $2.5 million, there were 1.4 life agents per agency on average. In the three higher classes, the average was 6, with agencies making more than $10 million averaging 8.9 life producers.
Across the classes, agencies spent an average of 2.2 percent of their income on technology.
Agents need to understand that technology is a process, Mr. Yates said, referring to one key point of the ACT report. "With technology, it is not just a one time investment and you arrive there," he said. "It is steady improvement."
The ACT report is broken into three segments–where technology is, where it is going and strategies for the future.
One recommendation for agents in the study is that agency principals need to have one person "focused" on technology, Mr. Yates said.
The report also tells agents and companies what they should look at over the next three years to continue to improve. In the future, for example, agencies will need wide-band capabilities to access greater information and transmit data. The report points out the difficulty in some places to obtain this service, suggests some remedies and stresses the need to push for it.
The ACT report is available on IIAAs Web site ( www.independentagent.com.), where members can also access some questions and answers from the Best Practices study and purchase the full report.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, November 5, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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