While carriers contend with updating or replacing legacy systems and managing new and emerging forms of distribution, independent agents and brokers increasingly are caught between carriers' technology limitations and consumers' ever-evolving expectations for better, faster and more-informed sales and service interactions.
To better understand the state of technology-enabled agency/carrier relationships, we asked execs and customer-facing producers at a wide range of independent insurance agencies and brokerages (see below) to share their take on insurers' technology strengths and weaknesses, and describe opportunities for developing better working relationships.
INN: Describe your relationships with the carriers within your network.
Pobuda: IMA has maintained strong working relationships with major property/casualty insurance carriers for more than 30 years. We have excellent relationships with each of them and work well with their underwriting, loss control and claims staffs. While personnel changes have taken place over the years and challenges arise from time to time, we have managed to work through these issues and, with the help of these carriers, have delivered consistent, excellent products and services to our clients.
Rothberg: We are a national brokerage; we're in nine states with 300 offices. Even though we have relationships at the national level, it's very much a regional relationship. All insurance is local.
Scardino-Treutel: Most carriers realize the importance of being easy to work with and providing real-time interfaces, or standardized electronic data exchanges, to prevent the need for agents to re-key information into a proprietary system. We do more business with carriers that provide real-time and download functionality.
Scullin: Keystone Insurers Group is unique in that we are a franchisor of independent insurance agencies. We hold national contracts with many insurance companies, and they are recognized as core carriers. Those companies establish individual agency codes to identify each agency they do business with. Because the partner agencies fall under Keystone's contract, all of their individual codes must be rolled up, or aggregated, under our master code. When requesting reports from our companies, it's not a single report for one agency; it's the combined report that makes up Keystone as a whole. They all have a willingness to help and understand our model, but their systems hinder our mutual productivity and efficiencies.
Weeren-Stanford: Weeren Insurance Agency has a very easy relationship with our carriers. We routinely are invited to assist them when they are piloting new systems. We belong to several user groups and technology committees, and I started the technology committee within Combined Agents of America, and several carriers.
INN: Describe the No. 1 technology challenge you face when interacting with carriers.
Collier: [Ours is] receiving duplicate copies of documents, such as policies, endorsements and audits, by mail and in electronic format, as well as handling information numerous times.
Mandato: Each carrier has its own platform, which requires multiple inputs and interfaces and work is duplicated if you are to use a carrier's proprietary system.
Rothberg: The technology is so fragmented. We use rating software that we connect to our management software that we connect the carriers to. You'd think there would be a national rater software, but there's not. So in each individual market, there is a rating software, and if you want to set up a national platform, it's very difficult. As a broker, you can't just say "I'm going to use three regional carriers and market nationwide," because certain carriers in certain markets are not priced competitively. You have to work with regional carriers. And it's not just technology. It's the industry as a whole. From a broker's standpoint, it's ripe for consolidation.
Scardino-Treutel: The toughest challenge we have is getting all carriers to implement real time for all lines of business.
Scullin: Our biggest challenge, when interacting with our carriers, is the lack of standardization. Each company's reporting is vastly different. From format, to content, to frequency, no two companies are alike, so manual adaptations are made.
Weeren-Stanford: There is zero uniformity amongst the various systems, or in policy deliverance, especially in commercial lines. The workflow is different for every single company, and addressing that is my new pet project.
INN: What are your other priorities?
Collier: Currently, we must go to the carrier's websites to download our agency documents. If carriers could send it to a secured agency portal or site, this would greatly improve the process and relationship. A standardized policy-download process would be very helpful. Eliminating the carrier differences would be huge for agencies.
Mandato: There's no industry solution, since carriers each have their own technologies incorporating both legacy and new products.
Rothberg: Getting the data to where we can analyze our business. That's a real challenge. We say we manage by facts and data, but we can only do that with the facts we have. It's very hard for many brokers, especially those who are direct bill, to have a sense of churn and renewals because there are different standards, and carriers each have their own technology. The second is the management software. Do we have to change the way we do business to accommodate the management software? We think what's unique about us is the way we do business. And when you have management software, it's one size fits all, which doesn't work that well. So we developed our own software for our metrics and numbers and manage our business in real time.
Scardino-Treutel: We are working with carriers through the Agents Council for Technology (ACT), [which is a part of the Independent Insurance Agents and Brokers of America established to address the critical workflow and technology issues facing the independent agency system,] to facilitate the electronic exchange of non-standard data for more complicated mid-commercial risks. And we are bringing the concept of real time and download to the managing general agents through the Excess & Surplus Joint Working Group, sponsored by ACT, the Association for Cooperative Operations Research and Development (ACORD), National Association of Professional Surplus Lines Offices and the American Association of Managing General Agents.
Scullin: Our partner carriers operate on legacy systems. While some updates have been made over the years, they seem to be more cosmetic in nature rather than true upgrades to their technology.
Weeren-Stanford: User-friendly interfaces. Even if there's a lack of uniformity, if they are user friendly that just makes it easier to do business.
INN: What's working? What's not working?
Collier: The insurance industry needs a better way of communicating and transferring information to improve efficiencies and security on both sides in order to better serve our clients and maintain their privacy.
Mandato: Personal lines works better than commercial P&C. Benefits also works better than commercial property/casualty. There's more standardization of the data, which allows for interfaces, such as IVANS or downloads, to be more effective than on the property/casualty side because of its diverse data.
Rothberg: Standards. In the next five years, I think you will really see the emergence of standards, so I'm optimistic. In the short-term, we need to live with that pain.
Scardino-Treutel: The Real Time [campaign, which is a group of agents and brokers, carriers, technology providers, user groups, and agent and industry associations united to advocate implementation of real time and download interface applications by independent agents and companies] is gaining momentum, but we need all carriers to join in, and all agents to use the technology that is available through their agency management systems.
Scullin: Communications have been going well in some cases. The willingness to provide us with information is there, but because of the legacy systems in place, manual workarounds are often needed to produce what is requested.
Weeren-Stanford: What's working is carriers that have one-stop shopping. We have comparative raters and single entry for customer information, which populates websites from the personal lines companies that are picked. You get an indication and you can bridge over to that company's site, finish the underwriting process, key in the payment information and hit the button. What's not working is carriers that are not automated at all, where the process is handled manually. They are not winning some accounts.
INN: How could/should carriers improve the relationship?
Mandato: Property/casualty carriers do not subscribe to standardized data formats, which, in their defense, would be extremely difficult to adopt. The benefits side and personal lines seem to work better; property/casualty carriers could work more effectively with the various agency management vendors to streamline interfaces.
Scardino-Treutel: Many carriers are educating their field staff to bring the message to their agents on new technology developments and new product offerings. This is an important partnership that will increase implementations.
Scullin: The carriers should better involve partners/customers in their technology discussions, stay in contact with their user groups and allow users to test the developing technologies.
Weeren-Stanford: They should have more agent input when it comes to developing technology. Carriers should be allocating more budget and time to develop and prove their systems, and then get out and train the agents on their systems.
INN: What else could/should carriers be doing?
Mandato: Carriers should work more closely with the agent/broker community to determine how best to deliver services on a technology platform, whether it's a download, interface or portal.
Scardino-Treutel: Carriers could encourage their agents to embrace the technology by offering incentives for adoption.
Scullin: Carriers should communicate their current and future technology improvement plans and keep partners/customers advised of the status of their technological initiatives. Upgrading their systems is greatly needed, as is the standardization of technology in the industry.
INN: Describe a "quick win" technology project carriers could/should implement to make your interactions better.
Harvath: There are products out there that would allow agencies to make multiple submissions to the appropriate carriers for a particular risk. However, carriers have to be receptive to using these products and security is always an issue.
Mandato: Develop a better method for accessing their various sites. There's no unified authentication process, so managing online services becomes chaotic when you have hundreds of users in an organization.
Ramirez: During the quoting and issuing process on the carrier's website, a chat option would be extremely helpful to reach the underwriting team.
Rothberg: Quick win? I'll have to get back to you on that.
Scardino-Treutel: Download transactions have been available for many years, and the technology is easy to implement for both personal and commercial lines. And yes, commercial lines download is working well. Also, a recently developed transaction for claims download has been simple to build and has been quite successfully adopted by many carriers.
Scullin: The ability to download to our systems on an aggregated level and in a standardized format is pertinent to our business. It's our biggest struggle year in and year out.
INN: In a perfect world, what would the relationship look like from end to end?
Mandato: Have the agent/broker enter data one time and deliver it to multiple carriers. Then they could disseminate it among their various business units, marketing, underwriting, claims, loss control and others. This would not be an aggregator of e-mails, but a true database so that data could then be used effectively for other purposes, such as benchmarking.
Rothberg: We don't live in a perfect world. It's just so fragmented. As technology and systems improve, we will get a more unified approach and standards will be a big part of that.
Scardino-Treutel: The vision is for data to be entered by the agent at the point-of-sale, and the data would be able to be transmitted among the various partner systems, including carriers, re-insurers and third-party data providers, and then back to the agent to provide a professional and consumer-friendly experience for the client. The time savings from not having to rekey the information into multiple systems could then be spent building relationships with the client, identifying cross-selling opportunities and making more sales.
Scullin: In a perfect world, the carriers would be completely automated. There would be standardization across all company platforms and they would be easy to use. All carriers should expand their implementation of ACORD XML, and the ACORD XML should be extended to include aggregated information.
Weeren-Stanford: Where you can put your hands on the keyboard while you have your prospect on the phone. If you can quote it, issue it, the system underwrites it, you can key in credit cards and pay for it, and then hit enter and the policy is sent to you as a PDF via e-mail to the customer.
INN: Describe an example of steering business to or away from a carrier based on their technologies.
Mandato: This doesn't happen at Lockton because we focus on the best carrier match with client needs. If the technology platform is less than desirable, then we work with it and make the best of it. If they're truly the best carrier for the client, technology would not keep us from doing business. But it could cause us to move business if technology created problems for the client, such as incorrect claims data or loss funds not being properly calculated. The technology issue would have to be substantial and material for the client.
Ramirez: Most carriers have 10 screens to complete; some have 20. I'm going to do business with you if your interface and system are user-friendly. Take the comparative rater. If I have two carriers that are close, but I know one is more user-friendly than the other, I'm going to use that company to finalize the quote and issue the policy.
Rothberg: We don't steer business away, we just don't put them on our rater. But we will work with a host of carriers, and there are a bunch of reasons we work with certain carriers. It's not just price. It's based on the quality of their service, their claims, etc. There are many issues one must consider, especially for a business like ours that has hundreds-of-thousands of customers that we partner with. We view our relationship with the carrier as a partnership, too, but our job as a broker is to act in the best interest of the consumer and place the business with the carrier that best meets their needs.
Scardino-Treutel: We no longer do business with carriers who do not accept ACORD applications, which contain the data that's available in our agency management system.
Scullin: Although we're working with our carriers on technological issues, we do not steer business to or away from them because of this. We direct sales to companies based on what's in the best interest of the customer and on the merit of the companies' coverages.
INN: How often do carriers request your opinion or input on technology matters?
Harvath: We have been involved in periodic carrier roundtables on the subject of technology. Our needs are typically different than the carrier needs.
Mandato: Many years ago, when technology in the insurance industry was relatively new, there may have been more discussion among agents/brokers and carriers. With the speed of current technology changes, it becomes more difficult to collaborate. We haven't had a lot of direct discussions with carriers seeking our input.
Rothberg: We work with 50 or 60 carriers. The carriers that are looking to upgrade speak with us a lot, and we are constantly in touch with them about our requests. But until those standards are in place, it's just too difficult. There are certain carriers that are known for their technology and data, like Progressive. There are those who have set the standard, and as carriers look to upgrade their systems hopefully they will look to those standards.
Scardino-Treutel: Most agents are not shy and are happy to provide carriers with feedback on pain points in agency workflows. The best approach for carriers is to become engaged in ACT, because this forum is a partnership of agents, carriers and vendors working together to improve the independent agency distribution system.
Scullin: Typically we initiate the discussions with our carriers relative to receiving reporting in an automated manner as opposed to dealing with paper or with reporting in a singular manner.
Weeren-Stanford: All the time.
INN: What is your company doing to improve the agency/carrier relationship?
Harvath: Having mutual lines of communication with our carrier partners has been effective over the years in strengthening our relationships. Actively participating in the carrier's agency advisory councils has allowed us a voice with the carrier's executive teams to discuss changing client needs and the insurance environment so the carriers can consider our perspective and respond accordingly.
Mandato: We meet with them regularly at the local, regional, national and global levels, and focus on how to serve our mutual clients more effectively. Speaking openly about issues and working to resolve them is crucial to these relationships.
Rothberg: We are constantly working with and evaluating carriers to improve our relationships. For us, that's really important. It has to be a win-win and we need to understand what their needs are. Every carrier looks for a certain niche that makes them profitable. Other carriers may not want that business, so it's important to understand and work with them to understand what kind of business they are looking for on an ongoing basis.
Scardino-Treutel: My agency is very engaged in technology discussions with our carriers. Working together to make back-end processing easier is a win-win. Agents can sell more policies and carriers get more business.
Scullin: We continue to address the need of system upgrades with our companies. We maintain conversations relative to the need for our companies to be able to work with a group of agencies as opposed to a single agency with one code.
Weeren-Stanford: We welcome technology projects. Most of the major carriers have my phone number and I'm not shy to make suggestions about how their systems could work better.
