Is anyone listening to independent insurance agents? We are. (Photo: Shutterstock)
Since 2017, NU has partnered with the National Association of Professional Insurance Agents (PIA) to develop insights into the commercial lines segment from the perspective of independent Property & Casualty insurance agents and brokers throughout the U.S. This "Voice of the Agent" analysis forms a subset of the analysis developed by NMG Consulting as a part their annual Flaspöhler Study, used by carriers to help them best meet agents' needs.
The study is a much broader exploration of competitive performance and the success drivers within the U.S. commercial lines industry, incorporating the views of 1,500 agents and brokers on a national basis, covering more than 200 insurance carriers. It provides significant insights into the books of business and challenges faced by P&C agents.
Tough times for independent agents
Most interesting to carriers should be the responses to this question: In your opinion, what are the top three challenges facing competitors in your industry over the next 3 to 5 years?
Agents are clearly concerned about their future, as this respondent noted: "Changing ecosystem of who an insurance agent is. There are less and less small insurance shops, and a growing number of aggregators."
Other respondents mentioned competition from the internet and carriers themselves. One respondent described it quite eloquently: "Increased commoditization of insurance products removes the service component strength of local producers."
Another respondent noted that there is "greater demand for fast quotes in a world that gives customers everything in the snap of a finger. Inability to always provide immediate information because of complexity of commercial insurance."
Positive news for carriers
In reviewing the results, Mike Becker, executive vice president & CEO of PIA, noted: "More than half of the agents participating in the survey reported that their commissions increased, and more than one quarter said they remained the same. In addition, more than half who had a decrease said it was relatively modest, between 1% and 5%. This indicates ongoing stability in agent compensation in the current market conditions."
He added, "When asked to rate their overall level of satisfaction with the P&C carriers they use for commercial lines, agents responding 'very satisfied' (36.5%) or 'somewhat satisfied' (50.6%) were more than three-quarters of those responding.
This indicates that the overall agent-carrier relationship remains positive and stable, though we believe specific aspects of the relationship can be improved, such as digital capabilities. Overall, the survey results show a continuing high level of satisfaction with their carrier relationships and stability in commission compensation with more than half of agents responding reporting an increase in their compensation."
Flaspöhler has long conducted its own larger annual study of agents (the Flaspöhler | NMG Producer Study) on behalf of key P&C carriers, which use the results to help them best meet agent needs. Flaspöhler distributes the expanded questionnaire to NU's proprietary lists of independent agents nationwide as well as PIA's national membership, resulting in the most reliable and scientifically sound sample available.
This is part one of a three-part series for PropertyCasualty360.com. Carriers interested in learning more about the complete Flaspöhler Study should contact Karan Sabharwal at Karan.Sabharwal@NMG-Group.com, who is a principal of NMG Consulting.
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