Sales

How to keep going when you want it all to go away

How long will the Damocles Sword of the pandemic hang over our heads? As the days drag on, will it threaten to upend us indefinitely? Even though we try to avoid thinking about the troubling possibilities, they keep creeping into our minds, creating more stress, clouding our ability to stay focused, and leaving us irritable, angry, less effective—and tired.

It’s not a pretty picture, not one we could possibly imagine ever facing. So, when we’re confused and uncertain about the future, what are we to do? Here are some thoughts about this question: Don’t listen to yourself. Why does it always happen when we’re trying to get to sleep at night? What is so upsetting is what causes the anxiety and does the damage is the voice inside your head. We are never our own best friend in the middle of the night. Stop listening to yourself. It’s time for a personal fact-checker—but neither Alexa nor Siri qualify—this is a job for someone you trust. Reach out to someone and ask: “This is what’s concerning me. Am I on track or off the rails?” Look for new possibilities. The good news is that life is not a matter of choosing the right fake Zoom background to convince ourselves (and others) that we’re more than just OK. It amounts to more than that. Recently, an editor sent me one of my sales articles. He had kept it until he found the right place for it. Recognizing that it had been around for about a year, he asked if I would look it over to see if it needed updating. When I read it, I was shocked at what I found! In a relatively short time, the world changed dramatically—and the article needed updating to reflect what had transpired. People are no different, so it may be time to ask yourself a tough question, “Am I dated?” Think about it. What can you do to update yourself? Sure, you may know your job backwards and forwards, but that doesn’t count anymore. Focus on figuring out how to revise your performance. How can you make what you do more relevant? What can you do to enhance your value? Think about the possibilities. Get better acquainted with yourself. If you really want to get to know yourself as you really are, you might want to spend time in Wyoming. But be prepared, Wyomingites aren’t subtle. They don’t tip-toe around; they’re not afraid to tell it like it is, no matter who you are. Having lived there, I speak from experience. For example, I recall the memorable words of a motorcycleriding English professor from the University of Wyoming: “If you can’t write it, you don’t know it.” Here’s the point. If you want to get better acquainted with yourself, jot down life experiences from your early memories to now. Don’t just remember them, get them on paper. Write them down as they come to mind. Ideas never come all at once. If you really want to know yourself, start writing. You may like what you discover. Be ready for the unexpected. How many times in the last six months have you heard someone say, perhaps wistfully, “I’ll sure be glad when life gets back to the way it was.” Even though we may not have said it out loud, most everyone has harbored the thought more than a few times. It’s just too much to let ourselves think that going back is not an option. If we’ve learned anything from the pandemic, it’s that we should learn to keep an eye out for surprises and the unexpected. Even though we may not like to think that everything is up for grabs because of the pandemic, it is: the way we live, work, play, learn, shop, think, do business, and behave. It’s changing and will continue to evolve. Keeping an eye out for the unpredictable will make living easier and more rewarding.

SALES

Change the picture of yourself.

Add continuing uncertainty to the pervasive impact of COVID-19, and it’s more than enough to distort our picture of ourselves and crush our self-confidence. It’s too much to let ourselves think about what could possibly be coming next. How we happen to view ourselves is not a given or chiseled in stone, unless we allow ourselves to look at it that way. In a wonderful essay,

How we happen to view ourselves is not a given or chiseled in stone, unless we allow ourselves to look at it that way.

“Homo Sapiens: The Unfinished Animal,” physicist George Stanciu, Ph.D., writes, “Nature gives human beings no specific way of life—no fixed occupation, no fitting dress, no appropriate emotional profile. It’s as if nature grew tired when she fashioned Homo sapiens and left this one species unfinished.” And, that’s good news. In spite of everything, what we do with what we are given has not been written or handed to us. Our story is unfinished—and it is in our hands. Graham of GrahamComm is a marketing and sales strategy consultant and business writer. He is the creator of Magnet Marketing, and publishes a free monthly eBulletin, No Nonsense Marketing & Sales Ideas. Reach him at (617) 774-9759 jgraham@grahamcomm.com or johnrgraham.com.

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WHAT IS

INSURTECH?

An agents’ review

There has been a lot of buzz about InsurTech in the insurance industry over the past decade—among both insurance carriers and insurance agencies. However, many agents who hear the term are fuzzy on what it really means. InsurTech is an offshoot of the 2010 Fintech movement. By definition, InsurTech refers to any innovative, insurance-based technology that delivers new features, services or processes to agencies and carriers. These technology innovations are designed to streamline workflow efficiencies, increase productivity, and lower operating costs. Agencies and carriers are implementing these technologies to achieve a competitive advantage and improve their bottom line.

Traditionally, investments in carrier solutions far outpace the investment for agency solutions, given that agencies simply do not have the time or money to spend on automated solutions. Many InsurTech companies are relatively new or start-ups that are trying to bring positive change to an industry in which the legacy methods remain in use. Market entry for these new companies has not been an easy task. Not only do new vendors face a highly regulated insurance industry, they also are up against traditional vendors that actively work to block new vendor development and protect market share. InsurTech vendors take advantage of technology to disrupt or to improve processes through a variety of methods, but the two most common are: 1. APIs: The Application Programming Interface allows vendors to connect to other systems easily. 2. Plug-and-play solutions: These easy-to-use solutions enable a computer to recognize and configure the app with little or no user intervention.

Internet of Things Another term that is bantered around is IoT, or the Internet of Things, but what does it really mean? It describes the network of physical objects (things) that are embedded with sensors, software, and other technologies for the purpose of connecting and exchanging data with other devices and systems over the internet. For example: Water damage for homes and apartments are big claim items for insurance carriers. There are IoT solutions that provide sensors set near areas with washing machines, water heaters and furnaces that raise alerts when water is rising. The sensor can trigger a command to shut the water off to avoid a catastrophic loss if nobody is home.

The agents’ perspective InsurTech is a huge topic and covers many areas, so we can only begin to scratch the surface. This article will focus on personal and commercial lines. Given the pandemic, many agencies have adapted to a new way of doing business. And, InsurTech companies are positioned to mitigate some of the issues by replacing older legacy methods with innovative solutions at disruptive prices. Agents from agencies of various sizes helped to collaborate and provide input for this article. To start, we asked them for feedback on how they gauge return on investment for InsurTech solutions. They responded that the top factors to determine ROI were: time, customer service and cost. Time. The time saved was the most important criteria when trying to determine the ROI of InsurTech. For example, if a staff member saves 15 minutes a day by using an improved process or feature, it equates to five hours a month or 65 hours a year—just for one person. Multiply that by the number of staff members and the savings become substantial. Agents must look at the possible hidden, long-term benefits when they evaluate new technology solutions. Customer service. The second most important criteria was selecting solutions that improve customer service and response, which ultimately helps with retention. Agents are concerned about their ratings and reviews that appear online, so they look for solutions that add value and enhance their customers’ experiences. Cost. Additionally, agents will consider new products that improve time-and-service efficiencies. Agents prefer to see a 12-18 month breakeven (return on investment). In addition to the cost of the new automation, agents also consider the implementation and training-time costs when they consider the ROI. These agents do not want training on new products to disrupt their current operations and bottleneck their agencies’ customer service. Next, we asked the agents how they select InsurTech solutions for their agencies. These solutions are found through personal referrals from other agents, which the agents found are the best way—since it is better to hear from actual users about their experiences, if possible. Agents also reach out to their own personal networks. They have people they can call to ask questions and disseminate information. And, under normal conditions, many agents find new solutions through state, regional or national trade association conferences and conventions—but this year most of those options were not available given the pandemic. Additional avenues for research include reading various trade publications, insurance forums or search engines (e.g., Google). Agents also access vendors’ websites for information after reviewing ads shared on social media. When searching for new InsurTech solutions, these agents also take into account the vendor’s financial stability. They want to make sure that any new vendor they adopt will be around for the long haul. This can be difficult to gauge unless the vendor provides its financial information. Agents are concerned about adopting a new product, only to

have a venture capital company or a competitive industry giant acquire the product and change it, increase the price, or pull it off the market. When we asked if the national pandemic affected their decision to look at new InsurTech solutions, the consensus was “yes.” The fact that agencies’ staff members were forced to work remotely made many agency principals realize that running an agency remotely introduced new challenges. For example, one agency was focused on developing a digital marketing program and launching a new website. However, when the pandemic struck, the agency shifted its priorities to the following: • The agency put its new digital marketing plan and website on hold after it realized it needed to adapt a new remote workplace. • It implemented Zoom for video conferencing, purchased headsets for the staff members, and provided the necessary training. Adding Zoom replaced on-site visits, and gave the staff members the ability to talk to prospective clients and existing clients about their current policies and renewals. The pandemic also showed agents how valuable InsurTech solutions can be. Agencies with true, webbased agency management systems were able to adapt to working from home much easier than agencies with cloud-based systems or locally installed systems. Agencies with true web-based systems only needed to access the internet through their browser—no software installation was required. Comparatively, agencies with cloud-based systems had to install software on every remote computer physically. Employees at agencies with locally installed agency management systems that are not cloud-based, needed to bring their office computer home, or install the whole system on their home computer. The process was both time consuming and financially painful. When asked about the InsurTech solutions that proved to be most valuable for their agencies during the pandemic (when their offices were closed), the agents responded that—in addition to teleconferencing applications—they soon realized how much time could be saved using eSignature, which made the whole application process much faster and easier for their current or prospective clients. Without eSignature, agents were forced to use email or the U.S. Postal Service to send and receive applications. The entire process was slower and labor intensive. Using eSignature also solved another problem—no one had to worry about handling paper forms, and catching the virus. We also asked if any of the agents had explored new agency management systems lately. One agent has started exploring various options, since the agency’s automation costs are one of its biggest expenses. The agent prefers to have an agency management system that is integrated fully with everything including the agency’s website. Currently, the agent is comparing the real cost of adding all the extras (e.g., customer portal, mobile apps, self-service and eSignature) against new systems that have bundled these services. The agent is exploring what other kinds of features are available to help the agency reduce its workload, save time, improve service, downloads, analytics and reporting. Then the agent will be able to determine and compare its true monthly cost. Another agent said the agency really needed to upgrade from its old system— it was rigid and not equipped to handle some of the problems that exist today. The agent has just started the product-review process. Regarding additional InsurTech solutions, two of the agents interviewed said their agencies have a customer portal and/or mobile app. While customer portal and mobile app solutions are getting a lot of press, one agent found that the customer adoption/acceptance rate was low. At first, one agent was reluctant to embrace a customer portal. The agent thought that millennials would not be loyal to the independent agency channel. Much to the agent’s surprise, there is data in the last two years that indicates that millennials value an independent agent’s advice more so than baby boomers. The third agent’s agency did not have a customer portal or mobile app, but the agent was willing to look at them again. Only one agent interviewed had a self-service portal as part of the agency’s offerings. The agent viewed the self-service portal positively for the agency’s commercial-lines clients as it allowed customers to add a certificate holder, print their own certificate of insurance, and improved customer service. For the agents who did not have a commercial-lines, self-service portal for their agencies, their main concern was the price of the system, and whether their clients would view the adoption of such as system as a value-added service. Generally, the agents thought that the adoption rate of a self-service portal for personal-lines clients would be low among customers.

Future solutions We asked the agents what their No. 1 hot-button issue is, and what InsurTech solution they would like to incorporate into their agencies if there weren’t any limitations. The first agent wants a better customer relationship management system that would allow the agency to collect more information and improve analytics. However, the solution needs to be balanced. And, the system needs to be affordable, and easy to use for the producers, given that it will take more time to collect the data. The second agent would like to see more carrier integrations for commercial lines to help speed up the data entry and collection. The agent wants to see a personal-lines like quoting process.

What challenges does your agency face in adopting new technologies?

Insufficient training 38.6%

Insufficient staffing 31.8%

Lack of financial or other support from my carriers 31.2%

Insufficient budget 27.3%

No clear ROI 26.8%

Cultural resistance 25.2%

Lack of compatibility with most of my carriers 22.7%

Siloed legacy system 15.3%

Other 12.1%

0 5 10 15 20 25 30 35 40

Source: NU Property and Casualty and National Association of Professional Insurance Agents: March 2020

The third agent would like to see a method that will consolidate all the carrier rating and endorsements done in real time through a single interface. The agent wants carriers to provide full underwriting and rating information in their downloads—instead of the limited data that currently populates the agency management systems. If carriers downloaded the full information to the agency’s management system, then agents will not have to waste time to collect it from the carrier again at renewal. Complete information will streamline the renewal/rewrite process and save agents a tremendous amount of time. Improving the processing time gives agents more time to talk to their customers about important coverage items—they want more time to sell their insurance products, and close more business.

Automation In the end, personal- and commercial-lines business is all about data automation—and the burdensome amount of time and cost agents spend gathering, entering, submitting, processing, and retrieving data. Right now, there are InsurTech solutions that address these issues. These solutions clearly demonstrate new and improved workflow efficiencies for carriers and agencies. These InsurTech products/systems increase agency productivity and reduce operating costs, which improve profitability and increase the agency’s bottom line. So, these are exciting times. Find out for yourself what the buzz is all about: InsurTech, it will be worth your time. Quikfuzion, an InsurTech company, has developed an agency management platform designed to replace older and expensive agency management systems. Prior to Quikfuzion, Cooksley was CEO of Xcipio, which created the industry’s first real-time comparative rater that was sold to Fiserv. He spent 20 years in a family owned insurance agency specializing on mid- to largesized commercial accounts.

Who is in control? Who is in control? Agents and their data

All individuals and businesses have come to realize how critically important data is to their ability to function in today’s world. Security, privacy, authenticity, and control are all factors that must be considered when devising a data strategy. In this article, I will be focusing on control (i.e., who regulates access to agency data, who has the rights to use agency data, and who determines the purposes for which it can be used).

Insurance is data Data is more important to the functioning of insurance businesses than any other kind of business. Unlike organizations that make, service, or sell stuff, insurance businesses collect information about people and organizations, and the stuff they make or use in order to create and sell financial promises. Those promises (which we call policies or bonds), define the risks and exposures represented by people and businesses and their stuff, and guarantee compensation for damage, illness or death caused by specific kinds of incidents, accidents, or injuries—all of which are described by data. More succinctly, data is the only product produced by insurance businesses.

Information and data The distinction between information and data is a subtle, but important one. Information can arrive in many forms, but data always is digital. Despite a recent increase in consumer-facing websites and software apps for the collection of risk and exposure information, typically, insureds still share their information with agents or insurers using the phone or paper forms. This information does not become data until the agency or the insurer’s personnel enter the information into their computer systems. Sadly, this data will likely go through several transformations from data to information to data and back during its lifetime, because our industry does a poor job of sharing data electronically. For example, an insured shares a current paper policy (information) with an agent who keys this information into the agency management system (data) and then generates ACORD applications as PDFs (information),

which are emailed to their insurers to request quotes. The insurer’s personnel key that information into their systems (data) to generate quotes as PDFs (information), which are emailed to the agent. The agent then shares the quotes with his or her prospective customer, or types the insurers’ quote information into their proposal document for the prospect. Ultimately, the insured will choose a quote and the agent will request issuance of the policy and, eventually, the policy information will be downloaded (data) into the agency management system. And, then the PDF/paper policy (information) will be emailed/mailed to the insured and agent.

Regulators and data Insurance regulators seem to struggle to define the rights and responsibilities for data, applicable to the agents and insurers that they are in charge of regulating. Everyone will agree that insureds own their data, but very little of the data contained in the systems of agents and insurers actually is contributed by the insureds. Clearly, names and addresses and other personally identifiable information (e.g., Social Security numbers and birth dates) belong to insureds. But, what about data such as the coverages, limits, and deductibles recommended and entered by agents into their agency management systems? And, what about rating factors and prices entered by the insurer’s personnel or generated by the insurer’s systems? And finally, what about publicly available data such as convictions and classifications? State regulations hold agents and insurers responsible for the security and privacy of the data that “belongs” to insureds that is stored in their systems. While many insurers have their own data centers in which they have complete control of insureds’ data, the vast majority of agents utilize systems that they license from vendors that own the data centers in which the agents’ data is stored, and that they access via the internet using desktop or laptop computers (which do not store the data). Unfortunately, the regulators have no control over these vendors, so the agents are caught in the middle. Some states have begun fining agents for using outdated versions of ACORD forms—even though agents have no control over when their vendors update their systems.

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Ownership and control Discussions of data ownership quickly become fraught, and are largely beside the point. Control is the point (i.e., who regulates access to agency data, who has the rights to use agency data, and who determines the purposes for which it can be used). Unfortunately, most agents have ceded the rights to the data in their agency management systems to the vendors that control them. There are many significant benefits to using software-as-a-service solutions—when agents license the software, but don’t have data storage on-site for the programs or data. And, there is absolutely no reason that agents have to sign over their rights to control access to their data to the vendors providing these SaaS systems. However, the language of those license agreements definitively gives their vendors that right.

Agencies and AMSs How has this happened? It is a cautionary tale. When AMSs came on the market, many agency principals did not understand the new technology. Because most of the systems that were built originally focused on operations (i.e., accounting, policy and claims information and forms generation)—and offered little in the way of sales support like customer relationship management systems and mobile applications— agency owners typically placed little value on automation. So, when their vendors offered them the opportunity to outsource their technology, they leapt at the chance. In the early days, the agency management systems’ license agreements did not provide the vendors with control over access to the agencies’ data—and there is no reason that they should today. However, as the largest vendors grew, and they realized the potential of all that data, they changed their license agreements to give themselves the right to use the agents’ data. Data is a big business, and some big-data companies and private-equity firms return profit margins in excess of 50%. This is why it is important to read your licensing contracts.

De-identified and aggregated In order to use agencies’ data, big-data companies and private-equity firms commit that it will be de-identified and aggregated—which means that any data that could enable someone to identify a specific insured, or any of his or her individual risks must be removed. It also means that the data from many agencies must be combined in such a way that the business results exposed in their analyses can’t be traced back to a particular agency. This allows them the ability to analyze the entire insurance industry for trends. Additionally, according to many AMS licensing agreements, once the information is de-identified and aggregated, it becomes the property of the vendor. It’s not unusual for a vendor to charge its customers to provide analytics of their profitability and the efficiency of their operations, or analyzing and recommending courses of action for an agent to take with particular insureds. However, combining all agencies’ customers’ data to derive analytics about the industry as a whole deserves at least a conscious opt-in provision, instead of a clause in the SaaS license agreements.

Next steps When you look to partner with any vendor that will have access to your data, read your licensing contracts carefully, so you know what you are signing away. Remember to look at all your options—there is a broad range of InsurTech startups, which are available to you and offer you a wide variety of solutions. Sentner has provided technology solutions to the insurance industry for more than 40 years. He has managed policy, billing and claims system replacement projects for insurers, has provided strategic consulting for The Council of Insurance Agents & Brokers, and now consults with ACORD and serves on the boards of several startup InsurTech firms. Recently, he worked with representatives from Connecticut, the City of Hartford, UConn, several national insurers, and InsurTech Hartford to create the first InsurTech Accelerator in Connecticut.