Hard Market Adaptation

Agents and brokers are “going the extra mile” to prioritize client communication, retention, technology, and team morale as the hard market lingers on.

According to a recent survey by Trusted Choice, the national consumer brand representing the members of the Independent Insurance Agents & Brokers of America (the Big I), independent agents are stepping up efforts in a few key areas to combat challenges presented by the marketplace. Overall, agencies are re-sharpening skills that may have fallen off in softer markets and using technology to give them an edge in everything from communications and marketing to management.

“To work through challenging market conditions, independent insurance agents are innovating and going the extra mile to best serve and provide value to their clients,” said Charles Symington, Big I president and CEO.

“In this difficult market, the agents who are setting themselves apart are those who are adapting and improving communication, customer retention, technology, and the morale of their teams,” Symington said. “And no one is better positioned than independent agents to do all of that and assist their clients through these market cycles successfully.”

The recently released report, Navigating the Hard Market: How Independent Agencies Are Reacting, listed a few areas agents are focusing on to navigate the current market.

Agents are prioritizing communication and investing in educating clients. 65% of agencies have increased their communication to policyholders, 85% of those through email and 77% by phone. 21% are increasing paid advertising spends, and 47% are putting more effort toward community involvement. 75% are offering more educational content to clients. While 27% of agencies put more resources into marketing, some 18% cut their marketing spend, saying they are using other ways to reach clients and prospects.

Attention has shifted from acquisition to retention. 39% have prioritized clients by the largest premium impact to the client, with smaller percentages of member agencies refocusing their teams by size of account (8%) and complexity of account (7%). The survey also found that agencies are working on renewals farther in advance.

Agents reported implementing more technology across the board: 32% of small agencies (sized 1-10 staff) and 45% of large agencies (25+ staff) have added technology recently. 18% of respondents said they added new technology systems or applications specifically to address the demand of this market. 13% have added tech to help with automation, 10% have added tech for agency management and 10% have dedicated resources to website upgrades.

Independent insurance agents have also increased internal communication and beefed up perks such as company-paid lunches and extra time off to help bolster morale. Where budgets allow, agencies are springing for raises or bonuses. More than half of the agencies responding have implemented new training initiatives to address the challenges of the market.