The Connected Business of Insurance
May 23, 2019
Our 2019 Digital Agency Survey indicates that the national average for digital technology adoption among independent agencies is 43%. Given this score is nearly the same as 2018, it reveals that agencies have yet to fully embrace the opportunities that digital technology affords to service and support consumers in this new digital age.
Technology expands your agency’s communication channels—to clients and insurer partners. It effectively mobilizes your staff from their desk to your customers and prospects in the field. Digital technology also elevates your role as a trusted advisor, making you present at all moments of opportunity—anytime, anywhere. There is significant opportunity and competitive advantage to be had for agencies willing to adopt new technologies and implement digital transformation strategies.
The 5 Pillars of a Digital Agency
The Digital Agency Survey evaluates adoption of the five core capabilities of a Digital Agency, including a management system, insurer connectivity, mobility, cloud, and data analytics, which work cohesively together to drive digital transformation.
Here are a few key takeaways from this year’s report:
- 96% of survey respondents use a management system
This almost ubiquitous adoption by agencies worldwide confirms that the management system is the foundation of their businesses and indispensable for their day-to-day operations. Managing separate, disparate systems is both costly and time consuming to agencies. In fact, switching between different systems can reduce staff productivity by as much as 30%.¹ Using a single application to manage your entire business, including P&C, Sales and Benefits, eliminates the need for multiple systems and creates standardized workflows so that your staff can be more productive and make better business decisions faster.
- 63% of survey respondents receive eDocs and Messages download from insurers
Utilization of eDocs and Messages download is strong and growing among agencies in North America. eDocs and Messages are a form of download that push a PDF or a message from the insurer’s policy admin system directly to the agency management system. The ability to work in one management system versus referencing individual insurer portals ensures the most up-to-date P&C and Benefits information is instantly available at the moment you need it and saves up to one hour per employee per day.
- Only 47% of agencies have mobile access to management system information, and even fewer, 24% and 18% respectively, offer clients self-service portals and mobile apps
Given that more than half of all consumers first use mobile devices for anything they do online, agencies must embrace mobile technology now for both clients and staff. Today’s consumers demand anytime, anywhere service and businesses that don’t provide this risk losing their customers to alternative providers. In fact, 80% of smartphone users are more likely to purchase from companies with mobile sites or apps that help them easily answer their questions.²Your staff also demand greater flexibility and servicing options. Giving staff remote access to information and tools within the management system empowers them to quickly respond to client and prospect service and sales requests. In fact, 78% of survey respondents said access to the technology they like to use, such as mobile, makes them more effective at work.³
- 69% of agencies host software in the cloud
Studies show that 94% of companies that suffer from a catastrophic data loss do not survive,⁴ which is why more and more agencies are moving to the cloud. Hosting the applications that your agency relies on day in and day out in the cloud ensures continuous business operations and data security. By leveraging software that is always accessible and backed up by redundancies, your business is available to customers—even during a catastrophic event that historically would have completely disrupted agency operations. Additionally, by eliminating the time and expense spent managing IT systems, more of your staff’s time can be spent selling insurance and servicing customers.
- Only 23% of survey respondents use data analytics applications
Year over year, agency use of data analytics applications to gain insights from their management system data remains virtually unchanged. Ambivalence to adopting data analytics is likely due to the misconception that it is too complex and technical for agencies to manage on their own. However, data analytics solutions have rapidly advanced and are extremely accessible to any business regardless of size, revenue and/or IT resources. Agencies need to gather, process and get insights from data in real time across the entire business. Making the shift from being a data-generating organization to one that is data-powered gives agencies a competitive edge through enhanced decision making, insight discovery and process optimization. Data-driven organizations are also 23x more likely to acquire customers, 6x as likely to retain customers, and 19x as likely to be profitable as a result.⁵
Why Becoming a Digital Agency Matters
While the independent insurance agency channel has progressed in its adoption of technology, this year’s results indicate that there is still considerable opportunity for agencies to digitally transform their business to provide complete connectivity to staff, insurers and insureds. When you think about the core promise of insurance—to safeguard and protect what matters most in people’s lives—it is vital to use digital technology to ensure your agency will be there when your customers need you most.
For more industry insights and to learn how technology can help your business grow in the digital age of insurance, sign up to receive a complimentary copy of our forthcoming Applied Digital Agency Annual Report.
1. American Psychological Association
4. University of Texas
5. McKinsey Global Institute
Reid French, Former Chief Executive Officer at Applied Systems, was responsible for the company’s overall business strategy and operational execution. He played a prominent role in developing and fostering relationships throughout the Applied community. French came to Applied in 2011, after serving as chief operating officer at Intergraph Corporation, a global company at the forefront of geospatial and computer-aided design software. Early in his career, he was a strategic planner for the Walt Disney Company, and he managed investment banking transactions in the technology sector for Robinson-Humphrey. French holds a bachelor’s degree in Economics from Davidson College and a master’s in Business Administration from the Harvard Business School. He sits on the board of directors for Applied, Autodesk (NASDAQ: ADSK) and The Lovett School in Atlanta.