Today, every insurance distribution professional is looking for an edge. The insurance marketplace is moving faster than ever, competition is fierce, and there’s an indefatigable push to be ever more efficient and profitable.
Key to satisfying these complex needs is technology. The world of technology is of course as huge as it is confusing and in today’s gizmo, gadget, and hype crazed environment, you'll probably need a little bit of help to keep on track and headed in the right direction. To that end, finding the right management platform to help streamline and automate your information technology processes can make all the difference.
Unfortunately, many organizations are stuck looking for answers in their past instead of turning to the future. When it comes to technology, this is a critical mistake; when it comes to your operation's management platform, it's like going into a foot race shackled with a ball and chain.
With the right management technology in place, not only will your agents and brokers have all the tools they need to improve sales and conversion rates, but the IT department — liberated from the daily grind of troubleshooting, hotfixes, legacy system management/maintenance, and patchwork system integrations — can begin focusing on actually propelling the organization forward.
In general, ROI comes in one of two ways: decreased costs or increased revenues. When it comes to the information technology at play within insurance distribution companies, more intelligent management platforms deliver on both.
Cost Cutters of Increasing IT ROI
One of the greatest benefits associated with investing in an intelligent management platform as your company’s IT backbone, is the cost cutting potential. Here are 5 ways insurance operations can expect to increase their IT ROI by lowering overall costs:
1. Reduce Time and Effort Associated with Client/Policy Management
It’s not unusual for a commercial renewal timeline to run six months or more. On top of that, there’s a lot involved in the policy management process — from risk management assessments to organizational meetings and review analyses.
Agents don’t want (or need) to make this process more complicated than necessary. An efficient agency management system can help collapse these timelines by consolidating and updating relevant data in real time. Agents and brokers can access client information at the click of a button — making it easy to update an account with relevant changes or respond to client requests and inquiries on specific policy details.
You also cut out lag times as documents move between the agent and the back office seamlessly. This allows insurance professionals to achieve much quicker and lower-friction policy administration, reducing the time and resources involved while improving customer service.
That extra time and manpower can then be directed to other business-building activities.
2. Provide Clarity to Stakeholders, Reduce Errors
Miscommunications and siloed information are two of the most significant failure drivers in any insurance distribution operation. More often than not, this is due to outdated processes and systems. This can cause claim processing and policy maintenance times to increase — resulting in a parade of unnecessary crises over the course of the year and the potential loss of customers.
One way to avoid this is to get all the stakeholders on the same page. Using a smart, integrated IT system, all vested parties have access to the same information.
Integrated agency management systems not only allow for back office and client-facing personnel to have access to the same real time data anytime — reducing manual errors or ‘lost’ files — they also allow for management to gather data on closing, renewal, and performance rates so they can better understand which agents and brokers are underperforming.
This helps make coordination and communication more efficient, accelerating best practice adoption while limiting the operational drain exacted by unproductive employees and unprofitable clients.
3. Eliminates Costs of Unnecessary IT Team Involvement & Delays
Regardless of the size or scope of a business, the IT department is too often spending its time putting out fires. This typically leads to project backlogs and in trying to keep up, IT is prevented from pushing the needle of progress forward within the company.
Integrating new regulatory, policy requirements, or strategic changes into the business logic of a scratch-made or patchwork management environment can take considerable time and substantially increase operating costs over the long run.
On top of that, systems cobbled together by your IT team are likely to take a more narrow view of the business and deliver a more bare bones solution for highly compartmentalized task sets.
A smart, holistic insurance distribution management platform will thoughtfully incorporate all operational processes within a central environment that captures the entirety of your business workflows. The result is a systemic breakdown of knowledge silos — the same silos that make onboarding new personnel so difficult and time-consuming while restricting your ability to scale up the business. With these silos out of the way, the costs of growth are suddenly way lower.
By transitioning to a dynamic agency management system, IT will be able to focus on their core competencies, such as improving network infrastructure, planning and preparing for network system contingencies, and taking care of technical support.
All of this is critical to making sure your insurance business is operating smoothly and profitability.
4. SaaS Solutions Lower Total Cost of Ownership
The reason why so many organizations are transitioning to cloud-based technology is because it provides savings. Cloud systems remove the need to acquire servers, as well as the working hours that would go into maintaining their alternatives.
SaaS systems also reduce costs associated with expensive hardware devices and operating systems. Annual subscription models also allow you to budget and plan for the year because costs are clear and upfront.
5. Multi-Tenant Cloud Technology Offers Scalability on a Budget
Multi-tenant technology is a cloud computing architecture that allows customers to share computing resources with other users in the same cloud network. The key differentiator is that each participant’s data is isolated (and protected) to other tenants access.
(Think about it like renting out your car only when you’re not using it and being able to order more horsepower or more passenger space on demand; all without ever giving up your keys or actually letting anyone into your car. Imagine, for the sake of the analogy, that you’re paid to let people ride on the roof of your car when it’s otherwise not in use. It’s that type of utility, security, and convenience that multi-tenant cloud technology offers to your IT operations.)
Multi-tenant technology allows for agents and brokers to utilize an intelligent management platform that can service multiple customers, territories, and streams of revenue at a very low cost.
With a multi-tenant system, the need for complex and expensive infrastructure build-outs are removed, saving overall operating costs. Multi-tenancy combines the best of both worlds, allowing for easy integration, no wasted overhead, and security, while avoiding the capacity limits of single tenant systems.
The bottom line is that a multi-tenant approach enables companies to hold more data at lower costs. It also backs up automatically and provides for seamless upgrades, with no involvement necessary from IT (multi-tenant systems aren’t owned by the IT department, but the service provider).
Having a smart cloud-based system that doesn’t over-rely on and overtax the IT department allows them to focus on those tasks that have been sitting on the back burner, improving their overall efficiency and removing insurance distribution challenges.
Ramp Up Returns
Running your insurance distribution business through a smarter software suite isn’t just about reducing wasted time and resources, it’s about unleashing your full revenue potential. Unsurprisingly, that tends to drive higher ROI. Here are 7 more ways to increase the return on your IT investment:
1. Greater Claims Capacity
Claims management systems can help dramatically improve the workflows of agents and claims capacity.
Rather than simply dividing work up among agents, smart IT systems can utilize estimations and models to come up with more advanced solutions. This can help remove bottlenecks and improve agent performance.
2. Higher Renewal Rates
Retention rates are some of the most important numbers for any insurance agent to keep track of in their business. One way to improve those is through automated renewal processes.
With intelligent management platforms, it’s easy to maintain and keep track of renewals, helping agents to boost performance over the long run. Once a client’s renewal date approaches, the system automatically sends out a reminder to the client. The policy is renewed with only a quick e-signature, removing the need for the agent to remember every policy renewal date and increasing the chances that the client will renew because the process is so quick and easy.
Of course, it isn’t only about automating the renewal process to make it more convenient, but enabling a better managed relationship with greater customer satisfaction from which renewals naturally follow. It’s this type of technology assisted relationship management that helped Howden Broking Group increase their renewals by 30%.
3. More Cross-Sells
While every agent hopes a prospect comes to them and asks to buy more product, that doesn’t always happen. Of course, that’s not to say agents can’t see higher conversion rates when it comes to cross-sells.
An intelligent management platform can provide sales professionals with a toolbox of resources delivering data-driven insights on exactly what a customer might need. A smart management platform can pull all relevant data on current clients and offer instant notifications when it detects a gap in coverage or an opportunity for expanded coverage.
For instance, the system can notify the relevant account authority if a customer recently moved to a larger warehouse. That fact might open the door for or even necessitate a new or expanded commercial automobile policy, for example.
In this way, insurance distributors can always stay up to date on what their customers need, with minimal effort. The result? More cross-sells and higher revenue.
4. Greater Back Office Productivity
The back office plays a crucial role for any insurance distributor. More often than not, the information contained in the back office is difficult for agents or brokers to access in the ways and at the times they’d like — leading to sub-optimal client management and even errors.
Using an integrated system that allows for all parties to have easy access to the same information can help optimize traditional back office processes. Claims validation and processing, premiums billing, application entries, proposal generation, and payment records are all examples of data and entries can can be executed and partly automated through an agency management system.
This can remove many of the errors associated with manual entry, accelerate turnaround times, and facilitate improved communication. All told, it’s a recipe for enhanced productivity, which is a recipe for increased revenue.
5. More Effective Prospecting
Undoubtedly, prospecting is one of the biggest challenges insurance professionals face. It can be time-consuming and unproductive if you don’t know what’s working.
A smart, integrated IT system can change that by offering real-time data on which channels are most effective and where conversion rates are highest.
Bottom line: Agents can focus on doing more of what works rather than guessing.
6. Quicker, More Seamless Training/Onboarding
Training and onboarding employees is costly. Do it wrong, and you’ll be back to square one with nothing to show for it. According to Training Industry Quarterly, the average employee takes 1-2 years to become a fully productive member of the team. Yikes!
An intelligent insurance agency management system makes it easy for new agents to get on track and reduce onboarding times by some 30%. This means faster contributions to the business from new hires and less time wasted by senior personal training their juniors.
Putting It All Together
There’s no end to the pursuit of increased ROI. That said, it doesn’t mean that there aren’t any low hanging fruit. If you’re running an insurance distribution operation, more likely than not, one of those low hanging fruit can be found in your approach to information technology.
Rearranging your IT services around a comprehensive core digital management platform is probably the first and best target on which to train your sights. The right platform will cut costs, ramp up returns and most importantly, easily streamline IT processes.
This type of improvement will allow your IT department to focus on its core competencies, rather than waste their time putting out daily “fires”. What’s more, an upgraded insurance management platform will boost the productivity and efficiency of your insurance organization as a whole — making it an investment opportunity that you can’t likely afford not to take.