Carriers continue to battle each other for business with independent agents. Meanwhile, consumers continue to flow into the direct channel. “Consumers are shopping and learning more about insurance than they ever were in the past,” says Safeco Insurance president Matt Nickerson.
U.S. consumers still overwhelmingly prefer doing business with agents, according to a recent Accenture survey. And, most insurers continue to struggle with establishing a strong agency value proposition, i.e., the ability to increase loyalty among independent agents in order to achieve “preferred carrier” status with a larger number of agencies, says the consulting firm’s report, “Creating Value in the Independent Agency Channel”.
“We only win if our independent agents win,” said Safeco Insurance president Matt Nickerson. “Part of that is that the independent agents need to evolve and change.”
Safeco sells insurance products exclusively through independent agents, and, along with Westfield Insurance, Central Insurance Companies, The Main Street America Group, State Auto Insurance Companies, and Selective, is a founding investor of Project CAP.
Founded by Independent Insurance Agents & Brokers of America (IIABA) and the six carriers, Project CAP—Consumer Agent Portal—offers online marketing solutions to independent agents and manages TrustedChoice.com, the IIABA’s advocacy website. “CAP is one of many levers—but an important lever—in responding to the changing consumer,” Nickerson says. The site’s quoting capabilities for participating carriers should be nationwide this summer.
Home and auto insurance shoppers in 18 states can now request online insurance quotes through Project CAP, then find nearby agents to write those policies. Capabilities should span the nation by mid-year. Currently, 33 carriers have signed up or are in the process of signing up to provide quotes, with at least a dozen more carriers in the pipeline.
Carriers agree to present rates on TrustedChoice.com through a real-time data connection to the EZLynx rating vendor in each state it is licensed. They then pay monthly fees based upon state and per-quote fees each time a quote is presented.
Project CAP works with carriers and its rating vendor to balance a need for quoting information with the number of questions a consumer must answer. It also provides business intelligence reporting, such as where the carriers ranked in the listings, how many times they showed up, and how many times they were selected. Since the site only leads customers to agents who can write policies, TrustedChoice.com can’t track how much actual business is generated. Additional opportunities for data sharing, as well as carrier promotion and spot placement, are in discussion.
By increasing the online presence of individual agents and bolstering awareness of the independent agency channel as a whole, Project CAP helps carriers by putting them in front of some audiences that they have been struggling to get in front of over the last 10-20 years, especially as the digital age has progressed, says Project CAP CEO Charles Bacciocco.
According to IIABA, many independent agents and brokers are competing locally with the direct response companies and captive agencies by combining customized service and advanced technology in their personal lines marketing. And, online advertising and rate quoting capabilities are cited as successful ways to obtain customers.
“Many agents are receiving multiple leads and quotes, and from our early sampling, it appears that about half of those leads are turning into written policies,” Bacciocco says.
Last year, independent insurance agency Southern Financial Insurance Group took the plunge. “Part of our growth model was to have a presence on the Web,” says agency manager Stephen Copeland. “We had considered doing it ourselves but quickly nixed that idea when we saw what Project CAP could offer.”
Copland attributes an increase in sales to its efforts on the Web - updating its website, adding an online quoting option, and creating a Facebook page.
In addition to its more than 1,200 agency clients, Project CAP looks at the entire independent agency channel as its charge. “We have a branding challenge at an industry level,” Bacciocco said. “That's what Trusted Choice is supposed to be about.“
Laura Goodenow is a freelance writer.
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