The Value of Independent Agents

Savvy insurtechs are recognizing that agents and brokers are a dynamic part of the market ecosystem--but there's still considerable room to improve.

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There was a time when many in insurtech believed that agents and brokers would become obsolete, that consumers would turn to buying insurance policies solely from providers. Insurance agents and brokers were often excluded from the new technologies, advancements and business models insurtechs were developing as a result. Beyond aggregator websites, innovation wasn’t widely being created with agents and brokers in mind. 

However, the industry has all too often overlooked the value and significance of independent insurance agents and brokers to consumers. While 29% of consumers prefer to interact with insurers online, 71% like human contact more, according to a study of the online consumer by Celent. Insurtechs have also neglected the important role agents and brokers play in driving business and revenue to insurance carriers. Many believed that technology could replace the independent agent and broker. But, it has not and likely never will. 

Today, savvy insurtechs recognize that agents and brokers are a dynamic part of the market ecosystem. They know that consumers have varied needs and preferences when buying insurance. Some consumers may prefer to purchase directly from providers online, while others choose the help, guidance and support that agents and brokers offer. These insurtechs also see the value of how agents and brokers can contribute to their bottom line. 

With insurance premiums increasing, a continued volatile economy and other challenges, consumers, agents and brokers are seeking options to save money and achieve their goals. They want help. Many agents and brokers also want to switch from captive to independent and increase their opportunity, success and reach. To succeed, they need to do business differently. That means today’s demand and expectation for fast, easy, tech-enabled online experiences can’t be ignored by agents and brokers. Consumers want the speed and efficiency of technology and internet access across all areas of their lives, even if they’re not tech-savvy. That includes buying insurance from agents and brokers. Customers will often turn elsewhere if innovation and ease aren’t part of the process. 

Agents and brokers can also benefit from new approaches and ideas to modernize their business and help it grow. Beyond the benefit of speed and demand for tech-enabled experiences, the use of advanced technology can help attract and retain talent by helping curb the high turnover that is often seen among agents and producers, which in turn can help maintain loyal clients, as well. 

Firefly has long used technology and the internet to help independent insurance agents and brokers connect with carriers without the burden of production requirements. It also helps agents and brokers learn, grow and succeed in their business by leveraging technology and the Internet. My company, BriteCo, recently launched a tech-driven agent and brokers program to empower these professionals to offer our jewelry insurance to their customers. The program helps agents and brokers better meet their client needs, while giving an opportunity to expand their line of business. Our strategic plan had always included opening this channel for the industry as a complement to our direct-to-consumer business. More insurtechs are likely to find ways to include agents and brokers in their models in the future. 

The proven value of independent agents and brokers doesn’t mean they don’t need to adapt and evolve. In fact, it is very much the opposite. Agents and brokers need to be on the bleeding edge of the industry and be able to meet the constant demand of speed and ease. They need to quote fast and sell fast, with quicker binding and more efficient claims management, as well as stay on top of future advancements and innovations. The era of lengthy timelines and traditional paperwork in insurance is gone. Today’s insurance agency leverages digital tools to deliver results and sell in minutes. At the same time, technology doesn’t change that consumers want a white glove experience from their insurance agents and brokers. Industry professionals need to remember that they are educators, who have to help their clients understand their offerings and make informed decisions. Services and processes should be heavily tech-enabled, but the human touch is still essential and will remain so.

For agents and brokers seeking to participate in this exciting era of insurtech, the key is to evaluate where they are currently, including the products they offer, what’s selling and what their needs are, along with where things can be improved. For example, if an agent or broker sells a lot of homeowners policies, they should look for where better products may exist and if there is anything new they should consider, and how they can make improvements. For insurtechs and carriers, it’s important to see that brokers and agents still have a powerful role to play in the industry and will continue to do so in the years to come.

Dustin Lemick

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Dustin Lemick

Dustin Lemick is founder and CEO of BriteCo, a leading tech-driven provider of jewelry and watch insurance. 


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