LAS VEGAS–Independent agencies and their insurance carriers that fail to embrace real-time data processing will start losing market share soon and could find themselves out of business over the long haul, a trio of cutting-edge agents here warned.
"Technology will increasingly become the critical factor in the agency-company relationship," according to Edgar Higgins Jr., president of Thousand Islands Agency in Clayton, N.Y.
"We're building a bridge to better business processing, and need to work together with carriers to meet in the middle," he added during a panel on "The Future of Agency Technology" at the ACORD LOMA Insurance Systems Forum.
Mr. Higgins, the 2008 Champion in the inaugural National Underwriter P&C Agency Technology Achievement Award program, run in partnership with ACORD, said that "most agencies will soon recognize the critical importance of real-time transactions, and those that don't get on board will be left behind and aged out of the distribution system."
Mr. Higgins said the burden is also on carriers to "embrace ease of doing business as a process and help agents get transaction headaches out of their systems. They are the ones that will be rewarded with greater market share."
He added that "company proprietary agent portals are the most overrated tech options we're offered" because they add more time to an agency's workflow than they save. "As a company, if you think that's a silver bullet to solve our problems, they're not," he said.
Liz Tluchowski, chief information officer of Couch Braunsdorf Insurance Group in Liberty Corner, N.J.–which received an Honorable Mention in the NU award program–said that "without adopting standards and real-time processing, we cannot survive as an agency system."
She added that carriers that fail to facilitate real-time transactions will see agents start steering business to competing insurers that do make that option available.
Johnmichael Monteith, CIO of Parker, Smith & Feek in Bellevue, Wash.–winner of another NU Honorable Mention–said that "while everyone talks about real time, we like to use the phrase 'no-time,' because we want the process with carriers to become automatic and instantaneous."
Adding that "all of us see what the utopia is," Mr. Monteith explained that agencies "seek complete integration with our carriers, with no time wasted on authentication access passwords and other artificial and time-consuming tech roadblocks."
Standards play a key role in facilitating multicompany interface with single data entry, the panelists agreed.
"I don't have to know how the car works–just be certain that I can get in and drive it with maximum engine efficiency," said Mr. Higgins. "ACORD XML standards have been absolutely phenomenal as an enabling tool. I don't know how XML works exactly, but I know standards make my job easier and faster to do."
He added that "if I can do something in 15 seconds thanks to standards that used to take me three minutes, that's two minutes and forty-five seconds I can devote to more productive work." He warned that it won't be long before most agencies refuse to work with carriers that do not offer more efficient, standardized access systems in real time.
The panel's moderator, NU Tech Editor Ara C. Trembly, noted that some carriers believe agents are the problem, complaining many fail to take advantage of real-time options already at their disposal.
"I can appreciate the frustration of carriers–particularly their [information technology] managers, who sold their CEOs on the idea that, 'if we build a real-time system, the agents will come,' and then they didn't rush to embrace it," said Mr. Higgins.
"I say, be patient," he added. "Agents will soon recognize this is not only the best way to go, but the only way to go if they want to stay in business."
Mr. Monteith said a "critical mass" is approaching, likening adoption of real-time processing to the cell phone. "Not everyone carried it around when it was a huge brick, but now everyone has one," he noted. "As long as we focus on the pain points in the transition and fix them, everyone will eventually get with the program."
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