(extract from http://techcrunch.com/2016/05/02/insurance-brokerage-is-broken/)

Technology to empower existing infrastructure (in-person agents)

While strong secular trends suggest the disintermediation of the in-person agent over time, new software solutions may help some maintain staying power. Considering other industries that have made the transition online, many tech-enabled solutions have helped optimize (rather than displace) existing infrastructure (think Compass for real estate brokers). In the more commoditized insurance products, technology may enable brokers to achieve the scale and efficiency necessary to operate profitably.

In complex lines that require more sophisticated underwriting and consumer education, we see tech delivering creative ways to differentiate on service. We’ve yet to see specific solutions in this space, but believe there is real potential, and welcome submissions for companies that are considering how technology might empower the in-person broker of the future.

One idea we’ve discussed is whether there is a way to build a marketplace for agents, enabling each to promote her/his own business and scalably acquire customers. Historically, independent brokers have struggled with customer acquisition in a fragmented market. With flat commissions and pressure on margins, the need to grow scale and increase to a more regional or even national focus is growing.

Building a marketplace model that enables agents to get licensed and reach customers across state lines, with ratings and reviews to differentiate, might prove valuable. Because insurance products are relatively commoditized, the challenge would be in developing a model that has more durable network effects where brokers differentiate outside of price.

While geography might be the premise for lead sharing in a marketplace model, another potential lead-sharing opportunity in this space could evolve through virtual teams that own the full stack of insurance products. We can imagine a model where teams of specialized agents across different product lines participate in referral sharing, and also leverage shared back office services for operational efficiency. In this way, agents can achieve scale and amortize the customer acquisition cost while still maintaining specialization in more complex lines.

Finally, the emergence of more bespoke, niche insurance products is creating opportunities to enable agents with analytics to more effectively consult clients and support the
underwriting process. Given the complexity of cyber insurance, today, large carriers like AIG ultimately do the underwriting while companies like Accenture perform assessment and prep.

There is a category of software that’s become general cyber risk assessment, understanding the shared vulnerabilities of companies and creating a risk score. We can see agents armed with software solutions from cybersecurity companies that deliver highly customized assessment and underwriting. A similar example of this model is a company called Syndeste, which provides analytics tools for brokers to assess and price flood insurance risk.

Closing

While many factors are driving the tipping point in the online distribution of insurance, the thread that ties it all together is actually a simple one: changing demographics. The millennial generation has tremendous buying power, and will soon become the industry’s primary customer, whether in consumer or commercial lines.

Insurance companies cannot expect to sell the same way to a cohort with fundamentally different purchasing habits and expectations. Players that can find new ways to sell insurance products — to new audiences that are used to buying products differently — are poised to capitalize on a huge opportunity.

This article was sourced from http://techcrunch.com/2016/05/02/insurance-brokerage-is-broken/ 

Pfirestorm is an affordable internet based service that organisations are able to offer their clients that will result in the cementing of existing relationships and/or the establishment of new relationships between the clients and the organisation.

This service is CLIENT-CENTRED and simultaneously provides the organisation with a platform that addresses fundamental business matters such as strategy and wealth creation, operations and practice management, compliance issues, day to day matters, vast Marketing opportunities, leveraging IT in a unique way, staff incentives and measurements and impact directly and indirectly on your income flows from day one.

The purpose for this service is to enable organisations and clients to be able to reach out to one another in an environment that is transparent, promotes shared responsibility and facilitates relationships providing mutual benefit for the client and the organisation.

It is no longer a matter of who you know! It is who knows YOU!

It is time!

VALUE PROPOSITION TO OUR CLIENTS

Pfirestorm’s unique collaborative technology will enable our clients to deliver a branded and unified sustainable experience to their customers at all levels of their organisation, through programmed alignment of internal procedures and processes with their Customer Value Proposition.

Our clients will experience the power of a programmed behavioral system designed to sustain, facilitate and deliver to their clients, a distinctive Customer Value Proposition resulting in increased new and retained customers that can be measured in terms of higher production outcomes, reduced operating costs, focused employee and customer activities, customer services that exceed expectations, business continuity, and ultimately good corporate governance aligned to a dynamic regulatory environment.