Survey: Agencies Seek Carrier Help to Expand Into New Niches

The challenges of today’s economy appear to be driving some independent agents into new niche insurance markets and product lines.

Almost 60 percent of independent agents say they have begun to or plan to expand into new business lines, according to a new survey by Channel Harvest Research that explores agents’ attitudes about insurance carriers.

In addition to exploring agency motives and challenges for doing so, the study also explored what carriers can do to help their agents succeed by enabling that expansion.

The survey of independent agents on their attitudes regarding carriers — on a wide range of issues — was sponsored by Insurance Journal.

Four-in-10 agents report having already taken on at least one new line or niche in the past three years, with another 18 percent planning to do so in the next three years.

Another one-in-four agents also expressed interest in expanding, but said they are not sure and are waiting for a variety of reasons.

Given the challenges reported by agents who have expanded into new lines, this relatively high number of agents waiting to expand is not surprising, said survey director Steve Craig.

“Insurance carriers clearly have an opportunity to increase revenues by helping agents expand their business,” Craig said.

While some agents have been invited by carriers to expand into new lines, this appears to be the exception rather than the rule. Many agents expressed strong desires for the carriers they work with most to offer a wider range of products.

Most agents already have — or plan to — expand into new commercial lines, such as workers’ compensation or the rapidly growing field of cyber liability. The research report covers the specific new lines and niches of interest to agents.

The research also delved into ways carriers can help these transitions succeed. “Offering additional lines is simply the first step,” Craig said. “Carriers that want to grow these lines need to address a series of structural issues facing agents. Agents don’t want to be treated like the carrier has never heard of their firm before.”

The survey report covers many more specific challenges mentioned by agents that have already shifted into new markets and the concerns raised by those considering it. The survey also addresses “Why Agents and Customers Choose Higher-Priced Insurers.”

About the Survey

The “2012 Survey of Agent-Carrier Relationships,” is the fifth in a series examining independent agents’ views on marketplace issues. The survey was sponsored by Insurance Journal and conducted by Channel Harvest — a partnership between Aartrijk and Campbell Communications.

The survey instrument covered more than 90 questions. More than 1,500 agents responded to the survey and passed validation criteria. Quantitative survey results are presented in a variety of formats, including importance rankings of specific carrier attributes, ratings of specific companies on attributes, industry issues, and open-ended agency comments about what breaks out superior carriers from the pack. Information quoted in this article and the included graph is based on preliminary data. Final survey findings could differ slightly.

For information on obtaining the survey report, contact John Campbell at john@channelharvest.com or 202-363-2069.