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The Connected Business of Insurance

The Future of Commercial Lines Distribution

August 09, 2018

by Brian Wood
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The traditional way of working with your agency channel is changing. Today’s insurance agencies are going digital and have the same technology expectations as traditional consumers – they want 24/7 service and choice. In the competition for the best agents’ business, ease of doing business is foundational, and a robust digital experience is a differentiator. Paper-based or word-of-mouth communications are ineffective by today’s standards. Digital communication and collaboration are imperative.

Agents and brokers are competing for business, and they have an urgent need to easily select the right provider for their customer. True ease of doing business – fast quote, fast submission and/or rejection – via next-generation technology with real-time integration between agent systems and insurer systems is critical in a digital world where successful business outcomes happen in minutes, not weeks or months.

So What’s Causing This Change?
The insurance space is dynamic and becoming increasingly competitive due to tech-driven change and customer expectations for instant, more personalized solutions. But it would be a mistake to assume that the implications of the digital age are just intended for Personal Lines. Transformation is also highly relevant for Commercial Lines insurers. In the case of Commercial Lines, the nature of the transformation is different, with agencies indicating the main changes they expect to see in Commercial Lines over the next five years are consolidation – a move to fewer agencies – and an increase in the trusted advisor role.

Source: SMA Research, 2018 Agencies in the Digital Age

However, just like Personal Lines, small commercial insurers may come under pressure from some of the same forces, like digital-first insurance companies. These InsurTech startups may not always take the same form as existing providers. While many InsurTech startups will not survive, there is no denying that distribution disturbance is underway. Insurers need to consider how these InsurTech investments are changing the agent relationship and ensure that they are adapting to meet the new digital demands of agents. As the New look for Commercial Lines graph demonstrates, InsurTechs are targeting Commercial Lines with 18% focused on distribution. This level of investment should be shifting how your business is evaluating its distribution strategy.

With all this change, there are still fundamental needs at the heart of the business – the need for insurers to pinpoint which agencies are the best partners for specific types of risks and the need for agents to understand which insurers are the best partners for submissions of specific opportunities.

In a recent survey, Commercial Lines agents cited finding new business, pricing, and access to better, more helpful underwriters as some of the top challenges they are facing. Think about this as it relates to your business. Are you making it easy for your agencies to find you and understand your appetite? Are price details obvious? How are you looking to change this as part of your go-forward technology strategy?

Source: NU, the National Association of Professional Insurance Agents (PIA) 2017 Independent Agent Survey

The Game-Changing Tool for Our Industry
Traditional ways of identifying market appetite, such as referencing paper guides and insurer websites, prevent agents from having the most up-to-date data and only provides a partial view of potential markets for risks which can lead to lost business. In fact, in a recent IVANS Survey, 72% of agencies reported losing new business opportunities because they could not find the right insurer for their risks. This means that both sides are missing opportunities. This doesn’t need to be the case. IVANS provides insurers and MGAs an industry-first application to instantly communicate appetite and identify new business opportunities with agencies.

Three ways IVANS enables you to increase in-appetite submissions and drive premium growth:

  1. Product visibility to expand your marketing efforts
    Through a single platform, you can communicate new appetite to current agencies while expanding your marketing capabilities to drive new business. With a single exchange, you have access to a network of more than 30,000 independent agencies. Studies show that IVANS clients experience 4 times higher click-through rates than insurers only showing historical appetite data and 50% more impressions than traditional online advertising.
  2. Integrated search capabilities within agent workflows
    IVANS solutions are complimentary for agents to use and provide insurers the ability to communicate with agents directly within their everyday workflows. By using automated digital tools, you are able to instantly update your appetite without having to reprint manuals or update PDFs, allowing you to go to market instantly with the most up-to-date and accurate information for increased ease of doing business with agencies.
  3. Advanced appointments
    The system is easily customizable to help show your agents where you have interest, help them understand why they should go to you for business and provide them with a link get started. Not only will your agency partners see your appetite information but agencies that are not yet appointed with you will be able to search for and view your current appetite, enabling you to expand your distribution network and find new agencies to do business with.

Expand Your Distribution Footprint
IVANS technology is creating new opportunities for insurers to build the omnichannel distribution strategies required to drive profitable premium growth in the digital era. Insurers that automate appetite communication to increase product visibility for agencies are well positioned to grow their business.

Watch The Future of Commercial Lines Distribution webinar to learn how IVANS can help you find the right agents at the right time to improve submission mix and build a stronger pipeline.

Brian Wood, Vice President of Data Products Group for IVANS, develops innovative and data-driven applications, tools and services for the insurance industry. Prior to this position, he co-founded EvoSure, which was acquired by Applied in Sept 2015. Brian spent 10 years with Marsh & McLennan as Senior Vice President of Strategy and Business Analysis where he developed global insurance distribution platforms. Brian began his career in insurance building the first company to bind insurance online, insuranceOrder.com (a Trilogy company) which was acquired by Marsh & McLennan in 2001.

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