The insurance business is in a significant period of transition. The world is changing quickly driven by technology and the influence of the younger generations. The change is very evident in personal insurance and it is starting to effect commercial lines as well. There are many folks in our business who refuse to acknowledge this and will continue to operate as they have in the past. I think this is a big mistake and these same people will suffer as a result of their decision. Steve Jobs died recently at the age of 56. He was a true visionary who was driven to leverage technology to improve everyone’s lifestyle. He was never satisfied with what was, he always pushed for what could be. He had his share of nay sayers and I’m sure they all regret their lack of faith and decision to ignore this remarkable man. As our industry evolves it is quite apparent that independent agent insurance companies are looking to stop losing market share. They want to compete with the direct response companies who are taking that market share. They are concerned that many independent agents aren’t making the changes necessary to capture the personal insurance market. So they are hedging their bet by writing both through independent agents and brokers as well as direct. Not only does marketing direct allow them to control the process it cuts their overhead by eliminating agent’s commission which gives them revenue to fund the process. I truly believe that they honestly feel that independent agents and brokers are the best way for consumers to purchase insurance – they just aren’t convinced that those same agents and brokers will make the changes necessary to gain back market share from the direct response companies.

So what are the issues independent agents and brokers aren’t handling that will affect their ability to gain back market share? The new consumer is very comfortable using technology to research and purchase insurance – agents have to acknowledge this and offer the necessary technology for consumers to use. They also want the ability to handle the purchase and servicing of their insurance on their schedule when it is convenient for them. That means agents have to be available 24/7. The agency population is aging and they are losing touch with consumers as a result of this. They need to reach out, hire and train a younger workforce that relates to the consumer and is comfortable with technology and 24/7 availability.

In addition to the changes they need to make to their agency operations, independent agents and brokers have to develop a successful branding and marketing campaign to win back consumers. They are up against competitors with huge advertising budgets that have successfully convinced consumers that insurance is a commodity to be bought on price and price alone. The challenge is to not only convince consumers that price alone shouldn’t drive their decision but that buying coverage through an independent agent or broker means coverage designed especially for them and backed up with personal service especially when they have had a claim.

Because of the nature of being an independent agent or broker it is hard to establish a brand other than through the efforts of each agent or broker. IIABA has created the Trusted Choice(R) brand which is a good opportunity for agents and brokers to define and promote themselves and what they do through a single brand. It is imperative that agents and brokers communicate the advantages of purchasing from an independent agent or broker. The advantage consumers receive is the ability to choose the carrier they purchase from coupled with competitively priced coverage customized to meet their specific needs and backed by professional and knowledgeable service especially when they have a claim. There is no better way for someone to handle their personal insurance needs. The challenge is to get consumers to know and understand this.

Independent agents and brokers have to have a significant presence on the internet if they want to compete aggressively for personal insurance consumers. They need to get their agencies identified early when consumers are searching on the internet and that happens by utilizing search engine optimization. They need to offer consumers a way to price coverage and then contact someone immediately to discuss coverage. They must develop a reputation for having significant insurance knowledge and offering exceptional personal service in the community they service. That means using social media – Facebook, Twitter and LinkedIn. It also means having a dynamic website that is inviting and constantly updated with information that helps consumers to make better decisions on purchasing insurance and protecting themselves.

Agents and brokers have to create a positive image with the consumers in their marketing area. They need to be known for community involvement and commitment. They need to personalize who they are because ultimately most consumers want to have a personal relationship with the agent and agency they have their business with. This means not only using social media, a website and a blog but also having regular contact with your clients and your prospects. The more “touches” you have with them and the more information and service they get from you the longer they will remain your client or the more likely it will be they will become your client. I know there are some agents out there who disagree with me. They aren’t interested in being available 24/7 nor do they think it is possible. They aren’t concerned because they do primarily commercial insurance and they don’t realize that direct response carriers are making inroads with small to medium size “Main Street” business as well. They feel operating on the internet makes you a price seller but that does not need to be the case. They believe the current way they operate is still effective and they don’t even realize that they are losing ground every day and frustrating their staff in the process. Some are close to retirement and are looking to just hold on to the old way of doing things just a little longer until they sell.

In the end it’s each agency owner’s decision. I could be totally wrong and so could all the industry “experts” that are saying the same thing. I’m a betting man and I’m willing to bet that those agents that don’t decide to change how they operate will find themselves losing clients and ineffective in the marketplace. The question for those agency owners that disagree is: Are you willing to bet your business on it?