Navigating the Winds of Change: The Future of Independent Agencies

Surviving the Tempestuous Landscape of Rapid Consumer Evolution and Fierce Competition

Is the world changing too fast for the independent agency channel?

Is the industry – and its agency force – too set in its ways to be relevant or attractive to today’s consumer?

Many agents proclaim concern and confusion over the accelerated rate of change in consumer behavior, technology and emerging competition.

If this is a watershed period for agents – one that separates winners from losers – it would not be the first. Students of history will note similarities between today and previous periods – within and outside the industry – that resulted in a substantial ‘thinning of the herd.’

This paper contends that today’s agent must be both vigilant and expeditious in order to avoid the kind of damage that other industries have endured in recent years.

Today’s agent faces a new world of:

• Rapid changes in consumer behavior and expectations

• Emerging and existing, well-funded competitive channels

• A rising millennial generation, with different expectations, both as consumers and workers, and,

• A pace of change unlike they’ve ever seen before.

In addition, the influx of private equity and the impending advent of various risktransferring and risk-reducing technologies, e.g., autonomous vehicles, further disrupts their business landscape.

In periods of turbulence, fretful businesses often grab at new tactical responses, swinging from one ‘shiny new thing’ to another.

Rather, the industry should respond with a clear strategic directive, one that guides and aligns all tactical responses. Agents should carefully select their rightful place in the hearts and minds of the ideal consumer base.

They should pursue – or, more accurately, earn – the loyalty of that consumer demographic most likely to reward them with maximum Customer Lifetime Value. Not the price shopper. Not the high-churn customer. But, those who most care about the promise of insurance and the promise of relationship offered by the agency channel.

Agents will have to learn new skills and adopt new capabilities, such that they can communicate with meaning and delight – and they must master the technologies that allow them to do that with scale.

And, they must do that fast.

Part 2 delivers the Action Plan, the system that helps agencies do just that. Grow fast. Deliver outstanding value. And own the market of their choice.

The rumble of change is afoot.

But, change isn’t new to the retail insurance agent. After all, agents of all generations – boomer, Gen X, millennial - could easily say: “It’s not my dad’s insurance agency anymore.”

The average agency of today doesn’t look like its counterpart from a generation or two ago.

Over the years, we’ve seen agencies transform successfully – from ‘mere’ pass-through sales organizations to professional businesses.

They’ve adopted agency management systems, various communication technologies, and many have done their best to chase the professional standards of industry best practices.

Yet, agencies of all sizes and levels of maturity have declared bewilderment at the sheer pace and nature of change demanded of them today. Such that they just as easily may declare: “But, it’s not my dad’s industry either.”

What’s familiar is disappearing. What used to work, doesn’t.

Incoming generations rightfully feel some pride as they assume leadership. It’s good to finally be in control.

But, all too often, they reveal a nagging sense that, given the topsy-turvy pace of change in their world, they just may not be in control at all.

Don't miss out on insights to master these changes. Register now for the ZERT Masterclass or tune into Michael Jans Podcast for more in-depth discussions on shaping the future of independent agencies.