The generation gap has a new family member — the technology gap. And true to its genealogy, the technology gap is firmly rooted in age-related mindsets. Older managers, owners, and bosses on one side; their younger producers, potential heirs, and support personnel on the other. In the middle are industry groups aggressively seeking ways to bridge, if not eliminate, the technology chasm.
FAIA's VP of Information and Technology Paul Peeples deals with it every day. And while he commiserates with the young agents' concerns that their bosses "just don't get it," he remains optimistic.
"Agency principals don't totally get it yet in terms of servicing customers electronically," Peeples points out. He continually preaches "service" as the real purpose of agency web sites. "An agency web site is not like a carrier's web site," he said. "Agencies need to allow consumers to come to their site to do servicing. I always say 'make it a service site first.' The younger generation is going to apply that more, make the sites more service-oriented. We believe that will happen in the next ten years, with transitions from retiring principals turning over the reins to their children or selling to people starting out."
Along with the external web site communications between agents and consumers, experts such as Peeples agree that technology to ease the workflow between carriers and agents is another essential. "Surveys tell us that agents are tired of having to do so much work to write business," said Peeples. "They are willing to take less commission if the other account is easier to write [because of the ability for the carrier's and the agency's management systems to interact]. In general, the agencies are up-to-date with their agency management systems. They need to put the pressure on the carriers to get with the program."
But the processes are only as good as the people behind them. Peeples said that agents tell him carriers' staff often don't know or understand the technology that the carriers themselves have available. "They need to learn the workflows of agents in order to insert themselves into those workflows. Carriers' sales reps need to be the evangelists, not the bottlenecks."
Standardizing Processes
Peeples pointed to one huge conflict between carriers and agencies: Carriers are pushing independent agents to go to their web sites, but agents want to work through their own management systems for standardization. Furthermore, agents want to become more paperless, reducing the inefficiency of paper shuffling and processing. They want to process incoming electronic information with as little human touch as possible in order to reduce their overall processing time.
Generally, agents want to receive carrier bulletins and other non-policy/customer specific information by e-mail. In contrast, where the communication relates to a specific customer and/or policy, such as a notification of late payment or an underwriter inquiry, agents would prefer to receive alert messages. The problem is, the many different approaches being taken by the carriers with regard to these electronic communications threaten to cancel out the potential efficiencies and wreak havoc with agency workflows.
An extensive report in January 2006 by the ACT Electronic Communications Work Group called for standardization to meet these changes in communication modes among carriers, brokers, agencies, and consumers. Among many recommendations, the report called on ACORD to enhance the current XML Message Standard or develop a new one for alert messages that can be sent from the carrier to the agent, as well as from the agent to the carrier.
"Done!" says ACORD Vice President, Communications & Industry/Government Affairs Rick Gilman. And indeed, the new and improved XML is now available.ACORD often finds itself in the hot-seat, balancing the needs of one against the capabilities or willingness of another. "We tend to develop standards based on input from a variety of constituencies," Gilman said. "Carriers and agents all send maintenance requests for tweaking and upgrades. We make changes based on regulatory requirements, obviously, but anybody can submit a request for a standard, which then goes to a working group, and then to a vote by members. It's a very open process."
Save Time With Real-Time
One industry-wide initiative, Real-Time, offers a unique opportunity for agents and carriers to work together much more efficiently. Proponents claim it improves the sales process, increases profitability, and provides a higher level of service to customers. Real-Time is available to most agencies at no additional cost as part of their agency system.
Since the Real-Time awareness campaign was launched in mid-2007, implementation has been moving at a satisfying–although measured–pace, according to ACT Executive Director Jeff Yates. At a March ACT-AUGIE meeting of 135 agents and industry representatives, AMS Services reported that it has seen a 63 percent growth in Real-Time transactions year over year, with 400,000 such transactions in January alone. Applied Systems has seen the number of its agency-carrier communicating pairs using Real-Time grow to 43,000.
Two carriers said they are seeing strong usage of their commercial lines real-time rating where they are able to bridge entire vehicle and property schedules from the agency management system without re-entry of any of the data. There has also been a surge in the number of Real-Time personal lines quote requests. One carrier reported 50 percent of their quote requests are coming in this way; a second is up to 70 percent.
Gilman credits much of the progress to the strong partnership between ACT and ACORD in promoting Real-Time. "ACT is focused on driving the message to its membership," he said. "AUGIE, because of the connection with ACORD, is making sure the standards are there to support Real-Time–things like workflow tools, guides, study, and general information and support. We have a real synergy between us, and a great partnership with Jeff Yates. ACT and AUGIE meet two or three times a year to make certain that the projects are continuing."
Partnerships such as this are necessary to get everyone's buy-in, given the disparity in size, location, business models, and objectives of the various groups. Acceptance by regional carriers has been a special concern. "Unlike national carriers, the regional carriers do not embrace ACORD standards," Peeples said. "That presents a conflict in agencies, where you can end up with two different workflows. The regionals think it (Real-Time) is a lot of work, but it's not, really. It's all been created; they just need to get on board."
Gilman agreed that regional carriers, because of their size and focus, are not always as aware of some of the tools that are available, or their benefits. "We are planning some regional carrier meetings this year to reach out to the small mutuals and others to talk about Real-Time," he reported. National carriers have been part of AUGIE and ACT from the beginning and understand the value of Real-Time, Gilman said. He wants to bring that perspective to the regionals as well.
Regionals appear to be ready to join the parade. At the March meeting, two regional carriers reported that they met or exceeded their goal to double their Real-Time transactions in 2007 over 2006. A commercial lines carrier said it is seeing a steady but moderate increase in real-time transactions of 10-15 percent a month.
Different Views
If "everybody" wants these upgrades and new processes, why doesn't "everybody" rush to the new technology? "I look at the overall ease of doing business," Gilman said. "It's not about any one bell or whistle. If it simplifies the agents' workflow, agents will use it. From a carrier's perspective, they think, 'Well, we have this neat web site that does everything agents want it to, they should use it.' But in reality, they are one of 15 or so markets with which agents are dealing. It really boils down to: does it from the agent's perspective really make it easier to do business? People's perspectives are different."
For all the troubles, expense, and time necessary to keep technology useful and current, the benefits are realized in those same areas: ease of doing business, money saved on labor-intensive processes, and faster response times among all the stakeholders. As Ed Higgins of Thousand Islands Agency in New York, who serves on the ACT Electronic Communications Work Group and is a past chairman of ACT, says, "Getting here is hard; being here is fun."
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