Via Deb Franklin, co-CEO of PEAK6
In these hard-to-insure markets, insurtechs have the opportunity to launch new insurance products tailored to customers’ changing needs. New products can help insurtechs stand out from the competition and boost profit margins. Successful distribution, though, requires a strategy.
In this piece, I’ll explain how three strategies – partnerships with local agents, tech-enabled distribution, and powerful back-end support – can help insurtechs launch new products successfully.
1. Partner with local independent agents
Insurtechs can face problems when selling niche products. They may struggle to connect with – or even find – the right market. Customers might not be aware of new insurers in their area, which means those insurers aren’t likely to have the visibility that comes with brand recognition.
The solution: partner with local independent agents who understand the needs of their communities. Agent partnerships can help generate product awareness and build visibility and trust with prospective customers.
In hard-to-insure areas, local agents prove especially valuable. For instance, an agent serving a high-risk wildfire zone can help customers secure homeowners insurance by providing guidance about wildfire mitigation steps.
Independent agents’ biggest strength lies in their ability to build genuine customer relationships. Agents use the power of personal connection to:
Generate trust. Customers will build relationships and trust when interacting on a personal level with a local insurance expert working to find coverage that best meets their needs.
Deliver personalized insights. AI chatbots can only go so far. By getting to know customers as individuals, agents can deliver insights tailored to their specific needs.
Build customer loyalty. Pricing is one thing that sets many insurtechs apart from their competitors. But when prices change, customers may not stick around. Human touch provides the edge you need to keep customers coming back.
For insurtechs, it’s worth thinking about agent partnerships as long-term investments. Agents may have carrier connections that enable them to sell more than just your products. When customers purchase multiple policies, they’re likely to stick with that agent over others. Since that agent is your partner, your insurtech gets access to a loyal customer base that you might otherwise struggle to win over. With time, agent partnerships can both improve your customer retention rate and boost overall revenue generation.
2. Use tech to power your distribution
Local independent agents can be the backbone of your new product sales. But a traditional, paper-based approach will hinder their efficiency and slow your market penetration. To distribute your product at scale, your agents will need the right technology.
An added bonus: digital tools help your agents create a seamless experience for customers that will keep them coming back.
What tech can help your agent partners achieve the best results? They’ll need access to things such as:
- Powerful CRM software. CRM software helps your agents centralize customer contact information and automate repetitive tasks.
- Online applications. A digital, streamlined application process makes it easier to collect and store important customer information.
- IT infrastructure. When your agents experience tech problems, robust IT infrastructure can manage support requests, resolve service interruptions and handle bug fixes.
With this tech at their disposal, agents can save time on menial tasks to deliver fast, personalized service to your customers.
3. Strengthen your back-end support
When agents are selling your new product, they shouldn’t have to worry about handling other core business operations. Provide your agents with back-end support so they can focus on the day-to-day work that drives distribution.
The right support looks like:
- AI-powered rating and underwriting systems.
- Compliance and auditing tools.
- Cloud-based commissions tracking and statement storage.
- Digital marketing assistance.
- Process automation.
- Zero-trust security architecture.
When you handle things on the back end, you free up your agents’ time so they can focus on building and improving customer relationships.
Competitive edge
By distributing products in hard-to-insure places, insurtechs have the chance to secure an advantage over major competitors. But the product itself isn’t everything. Insurtechs need the right distribution model to ensure success – and the secret lies with local agent partnerships.
Although some industry observers have cast agents and insurtechs as forces at odds, the reality is that they can be powerful allies. When insurtechs enable independent agents with the right tech, they’ll have the tools they need to build long-lasting customer relationships. When customers trust your agent partners, they’ll trust your product.
Source: Digital Insurance
