Speed to market is a hot topic in the insurance industry. According to recent research from Stamford, Conn.-based Gartner Inc., 79% of life insurers and 86% of property/casualty insurers are investing in new technologies for product development.That's promising, but it won't do carriers, their customers, or their agents any good if new products get stalled on the road to the market.
Knowing this, insurers are paying closer attention to their distribution channel-and specifically, how technology can best support speed-to-market initiatives by "greasing the skids," so to speak, for their agents. Agents, in the meantime, are seeking the best products that match their markets.
San Antonio, Texas-based Surety Specialists, for example, caught wind of a specialty insurance product targeted toward residential and commercial construction contractors. The product made sense for Surety Specialists, because the independent agency operates in a Sun Belt state where a high volume of construction projects regularly break ground, according to Monica Campos, a principal at the firm.
However, the opportunity to market this product-distributed by Zurich Insurance Services (ZIS)-may have gone by the boards for the Texas agency if not for the support of the Jacksonville, Fla.-based insurers' Web-based distribution platform, called buildersrisk.com
According to Campos, her agency is now building a more robust business for builders risk coverage, thanks to the speed at which agency staff can write policies via the Web-based program.
In fact, she says, it takes five minutes to issue a builders risk policy from beginning to end through the builders risk.com Web site. Without the electronic distribution technology, the process would take a week to a month. "Now we enter the applicant data, get the price, invoice it, and it's out the door in 10 minutes," says Campos.
Independent agents such as Campos have the choice of partnering with carriers that provide the best ease of doing business. And, although carriers are aware that they need to provide agents with the tools that make it easy to sell their products, many perceive agents' preferences as a moving target.
As a result, they're often conflicted about what tools should receive the lion's share of their technology investment dollars.
For instance, many insurers invested in Web portals to support agency distribution only to find some agents weren't equipped to exploit the technology. In other cases, leading-edge agencies are ahead of "lagging" carriers in their technical capabilities.
A growing gap
Either way, agents expect carriers to attend to their concerns-and many of them aren't satisfied.
"The gap between agent expectations and carrier performance tripled on five of 10 factors that apply to ease of doing business," says Paul Croke, a founding partner for Scituate, Mass.-based management consultant Deep Customer Connections.
"Carriers' performance improvements are encouraging, but they are dwarfed by large increases in agent expectations."
Jeff Benson, senior vice president of marketing and sales at Zurich Insurance Services (ZIS), an exclusive wholesale affiliate of Schaumburg, Ill.-based Zurich Small Business North America, can attest to that fact.
"Agents can issue a policy over the Internet in less than 5 minutes using a six-step process," he says.
"But they still want to push the envelope further. So we're making efforts to improve on that 5-minute average-hoping to reduce the process to 3 or 4 minutes in the near future."
That attitude toward meeting agents' technology needs is in line with ZIS's original vision for buildersrisk.com.
The company launched a highly targeted marketing campaign for Web-savvy agencies that would value a browser-based program.
"Our goal in launching builders risk.com was to create a business model with an easy point-of-sale interface, and we think our model is the simplest way for an agent to access these types of products," says Benson. Since the site debuted in 2001, the number of agents using is has grown to 30,000.
One differentiating feature of ZIS's program is the ability for agents to e-mail an underwriter when they need to modify a new-business proposal. The system informs the agent if the new-business application can be auto-processed or if it needs to be referred to an underwriter for additional rating.
"Agents have told us that the distribution process needs to be easy and that when they have an issue with distribution, they need to have real-time access to underwriters or customer service reps," says ZIS' Benson.
"We have 70 individuals in our company that work all day long to answer agent inquiries about a product or a coverage, and this helps to improve product distribution."
Upping the ante
The site has a "call me" button that agents can click, and within 30 to 45 seconds a rep calls, he says. "It might be on an issue dealing with eligibility, rating or pricing. Whatever it is, the agent receives a quick answer to an inquiry."
ZIS also upped the ante on its Web-based product, by enabling agents to process policies of up to $10 million in coverage-up from $3 million.
Overall, the program makes it easy for agents to find coverage for a customer in one Web visit, which is crucial, says Surety Specialists' Campos. "And the system is intuitive," she says. "As you fill in information and answer various questions, the system makes assumptions based on that information. It pre-fills screens and greatly reduces the time spent processing a builders application."
What Zurich Insurance Services has done to shore up distribution success doesn't happen without consensus-building-between the carrier, agents and even customers.
A growing number of insurance companies, as well as industry groups that represent agents, are waking up to the fact that they need to make it possible for agents to have access to a higher number of Internet tools that enhance distribution.
"Agents value technology that can deliver real-time policy information from a carrier Web site through their agency management system," says Jeffrey Yates, executive director for the Agency Council for Technology (ACT), an operating unit of the Independent Insurance Agents & Brokers of America (IIABA), Alexandria, Va.
"Overall, agents are looking for what I call 'passport' capabilities, where they can log on to their agency management system and go directly to a carrier's site with little or no log-in duplication," he says. "They want seamless single sign-on. That's what insurers need to better cultivate."
Similar to Zurich Insurance Services, The Chubb Group of Insurance Cos., Warren, N.J., is listening to its distribution channel. Chubb executives were approached by a coalition within its force of 8,000 global agents, asking the carrier to raise the bar on its level of electronic workflow support.
A hot-button issue
As a result, real-time access to information for agents has become the hot-button issue, says Scott Wickstrom, manager of corporate e-business at Chubb.
In support of this effort, Chubb rolled out in June electronic applications for its professional and management liability insurance products, available at @chubb.com, a password-protected site for the carrier's agents, brokers and customers. Via the site, agents can now download and save editable PDF files to their PCs, and then complete and submit applications to Chubb electronically.
The release of these electronic PDF applications, as well as the recent redesign of @chubb.com, are the result of a high level of agency feedback, says Wickstrom. "Both are important components of our online services and we think it makes it easier for producers to select Chubb products."
In its effort to foster a higher degree of product customization for complex specialty products, Chubb is also making it easier to pinpoint coverage for technology companies seeking errors and omissions insurance.
Using an electronic tool called the E&O SMART Application, Chubb agents can identify a client's risk position and provide a quick policy turnaround time.
"It's not uncommon for typical cycle time for E&O insurance to take 90 days to bind. With the SMART Application, Chubb agents have been able to reduce this cycle time by 50%," says Wickstrom.
"We're always trying to establish a broader feedback mechanism with agents to determine what tools are most meaningful to them," Wickstrom adds. "So we ask, 'How can we make this process easier for you?"
