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Knowing Your Value in a Changing Marketplace

By Shonda Vorst

In a world of little green geckos, overly perky insurance saleswomen, and Mayhem, independent agents can find it difficult to stand out in the barrage of direct marketing messages. Two Central Insurance Companies’ independent agency partners offer their approach to staying relevant in a crowded marketplace.

Knowledge Is Power

When your agency has been around for 44 years, you must be doing something right. For Hamby & Aloisio Insurance Agency in Atlanta, Georgia, their strategy of focusing on knowledge, and not sales, is the right course of action to navigate the ups and downs of the insurance industry cycles.

“The world doesn’t need any more sales people,” says agency Vice President and PIA National Director for Georgia Vic Hamby. “People are trying to sell you on everything at every turn. We are the most marketed to group of people ever in the world and I think people grow weary of being marketed and sold to.” Vic feels what we particularly need in our industry are advisors who are educated and experts in their field.

“There’s no substitute for knowledge and knowledge doesn’t often come easy,” says Vic. “It involves a lot of hard work for a long time to become an expert in your field, but that’s what we ask our producers to do. Pick a niche you like and become an expert. Become that person your industry peers will refer to when they have a question. Then prove your value through sound advice and honest answers. Honesty is one of the keystones of our agency.”

Coupling sound advice and honest answers with competitive products allows agents to be just as or even more competitive than the direct writers and captives customers see on TV or hear on the radio. Independent agents offer the same, and often times better, products than the direct writers and Vic believes it’s just a matter of doing a better job of getting that message out to clients.

“We try to educate our clients that they’re buying a promise,” says Vic. “The only time they care about someone keeping the promise is when they need it. Those that go online and try to purchase their own insurance will eventually suffer for it. It’s a fairly cold process if you do it the direct way. There won’t be anyone there to help you when you need it. If you believe in the independent agency system and have a trusted advisor, then you’ve got someone who can walk you through what is often a very difficult situation when your financial livelihood is at stake.”

For Vic and his staff, marketing doesn’t stop when they write an account — that’s when it really starts. “It’s how we can differentiate the value of a good trusted advisor in the independent agent system. Learn how your clients prefer to be contacted and communicated with and then maintain consistent contact. You need to continuously let your client know that you provide value to them and you do that by contacting them throughout the policy period, not just at renewal time, and most especially at claims time. That’s what you’ll be remembered by.”

Staying Relevant in a Changing Marketplace

Change is inevitable, but how you react to change can determine your success — or failure — with adapting to it. Scott Lewis, founder and principal of Norton, Lewis & Goro in Alpharetta, Georgia, believes the insurance industry will see a tremendous amount of change over the next three to five years and independent agents need to proactively reassess their marketing plan to stay competitive.

“We, as an agency, are in the midst of reevaluating our strategies. The way we’ve done things in the past is not necessarily the way we are going to be doing things in the future. I don’t have the answers yet as to the exact direction we’re heading, but I’m convinced we are on the cusp of our industry changing for multiple reasons.”

“We’ll have new players coming into the marketplace and I think that will create a lot of change,” says Scott. Within the next five years, 50 percent of the industry’s talent will be retiring. New buyers are entering the industry and the way they buy and perceive things is very different than the buyer of 10-15 years ago.

“When you look at this millennial group, they are already about 20 percent of the workforce and in the next five years they’re going to be 50 percent of the workforce. They’re also going to be 50 percent of the purchasers for insurance. They do it very differently. The way they research and their mindset are very different than the way we currently market and operate.”

Another area of concern is carriers who have used the independent agency model as their distribution channel for years now looking to go direct. “It upsets me greatly,” says Scott. “Especially being a board member of the PIA.”

From Scott’s perspective, the most important thing the independent agent needs to do to stay relevant is to make the insurance transaction easier.

“While insurance is a complex purchase, we’ve somehow got to make it easier,” he says. “If we don’t improve the process, we’ll be in trouble. People want to be able to communicate with a person and they want to interact, but they want to do it on their terms. They want to get the process started on their own. They don’t want pressure, but at the end they want to make sure that they’re making the right decision. We’ve got to figure out how to help them buy and stay relevant.”

Norton, Lewis & Goro is predominantly a commercial lines agency and has followed a marketing strategy in the past that focuses on e-mail, direct mail, and phone calls. Now the agency is looking to write more personal lines business so they are investigating their marketing approach to this business and how they can build out their infrastructure to compete with the online world moving forward.

“We’re writing some blogs, looking into videos, and using social media, mostly Facebook and Twitter,” says Scott. “We’re looking into other digital resources and creating more of our own content. We’ve met with our web designer, a marketer, and a consultant about consumer experience. We’re trying to put the pieces of the puzzle together to formulate our strategy for the next three to five years. Realistically, all agencies should be evaluating what their approach is going to be because the way you’ve done it in the past probably isn’t going to be the most effective way.”

As vice president of the PIA of Georgia, Scott is heading an initiative he believes can help lessen the impact of these changes on the industry. The PIA of Georgia Summer Intern Program looks at how to draw college students into the industry. The program primarily exposes interns to the agency side of the business, but Scott is working with carriers like Central Insurance and wholesalers to provide these interns the opportunity to experience other areas of the industry.

“We need to do a better job of working together for our industry,” says Scott. “Companies need independent agencies and independent agents need more than just one carrier. If you don’t have competition, then the system isn’t working. We have to start working better with carriers and agencies to develop the next generation. If we don’t work together, we’re all going to be in a world of trouble.”

While ideally Scott would like this new wave of talent to work on the agency side, it’s also important for them to experience the company and wholesale sides because they might discover it’s a better fit for them. “It’s all about ensuring the future of our industry.”

Shonda Vorst, AIS, AINS is the senior communications specialist for the Central Insurance Companies. She is responsible for communications, advertising and public relations for the company including copywriting for the company’s publications and websites, coordinating the creation and distribution of promotional campaigns and materials, and managing Central’s social media.