Insurance Agents Convinced Digital Tools Key for Business Growth, But Many Are Not Using Them Yet, New Industry Study Shows

Insurance Digital Transformation Survey Measures Use of Digital Technology

NEW YORK (16 AUGUST 2016) Independent insurance agents don't have to be convinced that digital technologies are vital to growing their businesses, according to the Insurance Digital Transformation Survey; but taking action is slow with more than half of respondents saying they lack key digital tools and automation like client portals, mobile apps, and claims download. In addition, many agents are still using traditional modes of communication to connect with clients such as phone, email and fax. Fewer than half of agents today are utilizing text messages, social networks, instant messaging, and e-newsletters.

The Insurance Digital Revolution, an industry initiative organized by IIABA's Agents Council for Technology (ACT), ACORD User Groups Information Exchange (AUGIE) and the PIA to drive adoption of digital technology, published the survey which was designed to measure the industry's current use of digital tools.

"Agents understand the current market and know they need to make changes to compete. A significant number - 70% - have proactive strategies in place to implement new technology to improve their businesses," said Ron Berg, ACT executive director. "But even with that awareness, adoption of new technology has been slow. The number of options available is overwhelming and many agents don't know where to start, or need help in evaluating the return on investment of new technologies."

Agents Need Digital Tools to Compete in an On Demand Market

Digital tools can play a critical part in agents' winning new customers and strengthening relationships with existing clients. According to the survey, 43% of agents currently operate 24/7 using staff, automation, or a combination of both and less than one-quarter of agents have client portals (23%) or mobile apps (21%), demonstrating that there's a lot of room for improvement. But, when it comes to social media, agents are taking advantage. Many are connecting with customers on Facebook (78%) and LinkedIn (68%). And agents are using the tools to generate new business with nearly three-quarters of agents saying they're getting new business leads from the web and social media regularly.

But while agents are definitely taking steps in the right direction, there is still progress to be made with agency websites. Only 8% of respondents rated their sites as excellent. More telling, 60% of agents said their sites are average to poor. Many of these sites lack functionality, with less than a quarter of respondents saying customers can quote auto/home insurance from their sites.

"Although 91% of agents say their clients are not asking for a client portal and 92% say clients aren't asking for a mobile app, that does not mean they don't want them. Agents can't assume that no news is good news. When it comes to customers' digital requirements that's never true," said Mike Becker, Executive Vice President and CEO of PIA. "Look at banking - many institutions did not know how popular online and mobile banking would be with their customers until they adopted it. The same is true for insurance. These technologies provide quick, easy and on demand access to policy and billing information, quoting and rating."

Some Progress, But More Opportunity to Improve Workflow with Automation

The survey also revealed that while there is continued progress in agents' adoption of automation tools to improve workflow, there is still significant opportunity to improve efficiencies in how they process claims, quote new business, and make policy changes. Overall 40% of agents say that disjointed workflows is the biggest automation challenge. Yet, ,despite that challenge, 60% are not using claims download, and only 6% and 16% are using bridging to quote new commercial lines and personal lines policies, respectively. This means a number of agents are manually reentering data when they switch from carrier portals to their agency management systems slowing down the process and increasing the risk of error.

Greg Maciag, President Emeritu of ACORD concluded, "The results of the survey are encouraging. Many agents want to become digital, they just need guidance on where to start. The Insurance Digital Revolution was started to be an information hub for insurance professionals, creating a one-stop shop for information on all digital tools available and providing a roadmap on how agents can incorporate these technologies into their daily workflow. It is designed to bring agents, carriers, and vendors together, so they can join forces to revolutionize the industry."

About Insurance Digital Revolution

The Insurance Digital Revolution (IDR) is an industry advocacy and communication initiative to accelerate adoption of digital technologies that enable independent insurance agents to improve customer satisfaction, grow business, and increase profitability. Organized by IIABA's Agents Council for Technology (ACT), ACORD User Groups Information Exchange (AUGIE) and the PIA, IDR is focused on acting as an information hub with resources to accelerate technology adoption, generating awareness of new tools, providing a roadmap for implementation, and growing usage of existing solutions.

Editor's Note

The Insurance Digital Transformation Survey was conducted electronically among agents in the United States between March 8 and April 5, 2016. Overall, 4,304 agents, brokers, and Managing General Agents, responded to the survey. A full summary of the results is available by contacting Candace Boyle (candace.boyle@the10company.com; 212-614-4561).

Candace Boyle