Insurance agencies faced a myriad of challenges in 2020 but came through armed with adaptive solutions.
NU Property & Casualty's annual Independent Insurance Agent Survey, which is produced in partnership with the National Association of Professional Insurance Agents (PIA), is an illustration of that old adage about how two heads are better than one.
Each year, the survey brings together a pair of powerful insurance-industry resources to produce a comprehensive look at how agents are faring given market conditions and business concerns.
While NU Property & Casualty fields the survey questions with assistance from our corporate-research partner, ALM Intelligence, PIA analyzes the survey responses and results against the firsthand experiences of organization members. The result is a deep dive into the demographics, finances, strategies, tools, issues and challenges that define work in today's insurance world.
Attitude in everything
To be sure, 2020, with its historic global pandemic, presented independent insurance agents and agencies with a number of business hurdles that demanded creative problem-solving and a willingness to pivot away from the traditional way of doing things.
"PIA members are rising to new challenges, but the fallout from the pandemic is far from over," says PIA National CEO Mike Becker.
Here are just some of the emerging issues that this year's survey respondents pointed to when asked about the "burning issues" facing their business:
"Acquiring producers is always a challenge."
"Aggregators should be banned along with 'mail order' insurance… Many times, we are cleaning up their messes due to the fact that they are order takers."
"Attracting and keeping younger customers that don't value the relationship as much."
"Auto insurance is going away."
"Being able to offer the same online services as the direct writers and online companies."
"Better integration between agency management systems and carrier downloads is needed. Slowing the competition from our carriers that are selling direct to consumers is also very important. The willingness to allow customers to choose their own coverage and hang out to dry during a claim just to lower costs and increase profit is irresponsible."
"Carriers continue to push their work onto the agency through mandating the online quoting, binding and issuing platforms. At the same time, our commission percentages haven't increased to the lightening of their workload. Some platforms are harder to work with than others. Because of this, I frequently do not even attempt to quote an account with the more difficult sites."
"Carriers need to think about the impact [of] what they do on the agency and clients. Making changes that nobody requested and forcing the agency to pay for them, for example, or creating very time-consuming processes in order to maintain reduced premium in response to a pandemic is a problem."
"Carriers need to understand and invest in agency ability to streamline the sales process in personal and small commercial lines."
Clearly, there is no shortage of challenges facing today's independent insurance agencies, but PIA's Becker argues that with these difficulties has come a creative resiliency that is spurring agencies to rely on their strengths — namely, hands-on service and in-depth product knowledge — while bolstering the tools needed to compete.
"Agencies are now facing unique challenges as the result of the pandemic," Becker says. "Financial pressures and the need to operate more efficiently are concerns. Normal business problems are still problems to be dealt with. But what is encouraging is seeing the can-do, positive attitude that has served independent agencies well in the past manifest itself in response to the current challenges."
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