The latest Future One Agency Universe Study was recently released by the Independent Insurance Agents & Brokers. This study is considered one of the most comprehensive sources of information about the independent agency distribution system. Since 2000 the study has been completed biannually.
The most recent study was conducted in the spring and summer of 2008 and included 1,874 respondents. Ninety percent of those responding were agency principals, presidents, or CEOs.
While the survey produced a number of very interesting findings, below are results that show how agencies are utilizing (or not utilizing) technology.
One of the top 10 findings is that agents are doing more with less. “Agency operations are becoming measurably more efficient. Apparently, agencies are able to do more work with fewer employees. Increased usage of technology likely contributes to more efficient processes.”
While I’m encouraged by this finding, the details of the study show that there continues to be room for improvement in a number of areas. Many agencies are not utilizing technology as an effective tool.
- 82% use an agency management system (compared to 87% in 2006, although this study included a greater proportion of small agents). 50% of small agents do not use an agency management system.
- Traditional advertising continues to be most used by agencies, with 24% using Yellow Pages, 15% using print ads, 11% using radio, TV, and billboard. Only 7% use their agency Web site as a marketing tool, and only 2% use any kind of electronic marketing.
- 37% agreed or strongly agreed that it is important for the agency to be accessible to their clients 24/7.
- 35% of agencies reported having a paperless office. 54% stated they were going paperless whenever possible.
- Agency customers increasingly use electronic means to communicate. E-mail usage has increased from 55% in 2006 to 70% in 2008. 21% of agencies report that clients are obtaining certificates of insurance through the Internet.
Thoughts about these statistics
- The industry needs to realize that new generations of prospects will not be looking in the Yellow Pages for insurance information. Agencies need to begin experimenting with and utilizing the Internet and other electronic marketing options to find and attract these new customers.
- I am probably most disheartened by the 63% of agencies that said it is not important to be available to clients outside of normal business hours. Clients obviously want to communicate with agencies electronically. It is a small step—and the technology is readily available—to allow clients to communicate with you off-hours.
Agencies are making changes and learning how to effectively use technology. This will increase efficiency and improve customer service. But the new reality is that change is constant. Every agency, regardless of size, needs to continue to adapt to changing customer wants and needs.
