In my last post, I spoke about the role of customer-centricity in an operating model for leading international insurance groups. This time, I’ll discuss why agents remain central to the insurance business model and how insurers can build better relationships with their agents of choice.
Though international insurers have worked hard to establish direct distribution channels over the past decade, independent and tied agents are still the primary interface between most consumers and their insurance carriers. Agents offer customers what insurers usually do not—advice, breadth of product offering, and carrier choice. For international insurers, agents also offer a good understanding of local market conditions and customer needs in the territories where they operate.
That means it’s as important as ever for insurers that want to grow profitably to invest in creating preferred relationships with high-performing agency partners. Such partners have a valuable role to play in overcoming the skills challenges and organizational siloes that make it so hard for most insurers to cross-sell effectively, build customer loyalty and personalize their offerings.
Thus, we believe at Accenture that a clear value proposition for the agent is as important for international carriers as its customer value proposition. This value proposition aims to increase loyalty among independent agents so the insurance can be a preferred carrier for the largest number of agencies.
We also recognize that it is important for insurers to help their agents maximize their performance. Four key areas stand out:
- Optimize compensation and performance management: Insurers should embrace a nuanced approach to compensation and performance management so that they can incentivize agents to perform in line with their strategic objectives.
- Provide data and analytics capabilities: Insurers should leverage their analytics tools to give agents the predictive and actionable insight they need to better attract, serve, and retain customers. The data-driven recommendations can be delivered through multiple channels, including mobile.
- Expand agent segmentation: Most insurers already segment agents along metrics such as tenure, market share, number of employees, policies in force, and profitability. They should add “soft” criteria—ability to adapt to change, degree of technology savvy, prior business experience—to the mix for deeper insight into the agent population.
- Leverage customer segmentation: Through more effective use of customer data and related information, carriers can help improve the way agents manage and prepare for each valuable prospect or customer interaction.
In my next post, I’ll consider how insurers can discover powerful digital opportunities by expanding the perspective to partners—inside and outside of the company.