Insurance and the business world have changed dramatically in the last 20 years. In the past, business owners could make money without attention to detail because the success was mostly about relationships. Margins were good and the cost of running the business was about the people who worked for them. The success rates were high, at least in the insurance business, and the capital to start agencies were low. Finding insurers was easy, as was finding customers, as long as you put effort into meeting people and learning about their businesses and insurance needs. Good service always has been important, but with the right relationships, many businesses still flourished even with less than stellar service.
Things are more complex today. Insurers and agents are larger and more affected by technology and a social and public atmosphere that provides continual challenges to sustaining a long-term success strategy. Insurance is a profession of high ethical standards, requiring technical insurance training and an understanding of forms, practices, requirements, procedures and regulations. This is more true today than ever before. The growth of technology requires each insurance professional to become a technology professional as well. Today, margins are down and the attention to detail is critical.
While technology has driven some improvements, some of these changes also created disconnects. Customers used to call their insurance agents or brokers and receive an instant quote. Today, customers go to a Web site, answer questions, and hope for a quote rather than a referral to another number or Web site link to someone unknown. The personal relationship that was once so critical, and provided the foundation for conducting business, is becoming impersonal.
This change provides a great opportunity for those willing to bring a sense of "value added" to their customers. This commitment starts with learning the industry, creating relationships with your peers and insurers, participating in professional associations, networking, and educating yourself with selling skills and technical tools. Providing advice to customers about liability, spread of risk, market strength, and protection of assets are all value-added services.
Although the economy has put many people out of work, Americans are resilient and creative. Millions of people will seize the opportunity to change their lives and start new businesses, giving dedicated, value-added agents and brokers new opportunities. Because these new businesses will have no premiums, payments, or loss histories, they will find their ways into the specialty marketplace. Agents and brokers should develop relationships with professional, financially stable, value-added wholesalers. Wholesalers live on commissions, just like the retail agent or broker. The wholesale marketplace is a nimble distribution system that is less costly for the insurers specializing in hard-to-place, specialty or surplus lines business. That distribution system is here to stay.
The wholesale network will continue to evolve. It will continue to add value to the industry by providing access to additional domestic and international markets. Better, more friendly technology will be enabled and the network will provide local knowledge, and it will ease the complex filing requirements now required when writing surplus lines business.
There will be those who complain about the market and the economy. Pay attention to detail. Relationships are still critical. Use technology to build those relationships, not to put the business you desire to build out of business. Commitment + added value = opportunity in a changing world. Your future success is in your actions.