Tag Archives: personal lines

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Industry Launches Personal Lines Initiative

Encouraging independent agency owners to take a fresh look at the opportunity presented by personal lines of insurance, a powerful and motivated coalition within the Independent Agency System recently announced the launch of the Personal Lines Growth Alliance (PLGA).

The PLGA will bring a unique focus to personal lines in the distribution channel by showing independent agents and brokers the potential for growth, sharing knowledge and resources, and positioning them with their consumers. The Alliance consists of a growing cadre of agents, carriers, service providers and trade associations.

The personal lines segment is ripe for market share growth within the Independent Agency channel. While independent agents and their carriers command 80% of all commercial lines, they only write 34% of personal lines. Moreover, commercial lines is mired in a prolonged soft market, and recent economic worries have put downward pressure on premiums, with reduced payrolls, inventories, auto fleets, and other soft conditions.

Steve Brooks, chairman of the PLGA, says the Alliance will operate as a virtual association, leveraging the strong resources and educational material already available by its partners. “We won’t compete with other associations or reinvent the wheel, although we do intend to move the wheel forward. The Alliance will be a leverage point to highlight personal lines-focused growth tools available to agents from carriers, associations, and education organizations.”

Membership in the Alliance initially is free and open to interested parties.

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Agents—Take Notice

According to the most recent Independent Insurance Agents and Brokers of America market share report, independent agents wrote 80% of the commercial lines premium in 2007. The numbers, however, are not so rosy for personal lines. Direct writers and other types of non-independent agent distribution models accounted for just over 65% of the personal lines premium written that year.

Independent agents gave up on the personal lines market a number of years ago. We need to start working on taking it back.

Cindy Donaldson is the new marketing director for Founders Insurance Group in Torrington, Conn. She joined the agency just a few months ago from outside the insurance industry. She highlights her personal experience in a recent blog post about the issues facing independent insurance agencies and personal lines.

In the post she tells the story about a tradition in her town where the local paper publishes comments from graduating seniors. Her son’s comment? “You can save a bunch of money off your car insurance by switching to GEICO.”

Donaldson goes on to explain her view on how agents need to respond:

“In all fairness, Max wasn’t trying to be obnoxious or hurtful—he, like most Americans, has been overrun with images of talking money, geckos, and cavemen. He hears the gecko’s advertising lingo several times a day—and as he put it, “Mom, it was just a joke—it doesn’t mean anything.” GEICO, whether we like it or not, has become a part of pop culture in our society and that does mean a lot. They have mastered the art of inbound marketing—they have people like my son chanting their mantra constantly.

Heck—I’ve done it here in this blog. When a company’s logo, saying, or name becomes a part of pop culture, their Chief Marketing Officer gets a big, big bonus. It truly is the holy grail of the marketing department to reach that status.

So why is my son’s comment to freshman so important that I’m writing about it? Max’s generation will soon be the generation with the buying power, and how they receive information—including advertising—will determine what and how they buy. If I wasn’t the one purchasing my children’s car insurance and advising them on the importance of having an advisor look at their individual risks—my children would probably be wooed by the influence of advertising and assume that everyone is buying from the gecko and ergo they should too.

Independent insurance agents need to take notice. No longer can we sit back and wait for the phones to ring, or assume that the children of our clients will automatically become our clients. We can’t compete with a multi-million dollar advertising budget—so we need to connect with our clients in other ways, by creating our own inbound marketing strategies.”

I couldn’t agree with Cindy more.