There is a growing consensus the world is headed towards a recession. InsurTech platform Novidea has offered five ways that independent agents and MGAs can thrive in a recession.
It stated that smart agencies and MGAs should be planning their strategies for a potential recession, whether it is a major event or a small dip. By being prepared, firms will be better suited to thrive.
Thanks to the pandemic, many agents, brokers and MGAs have undergone several operational changes over the past two years. They have been quick to adapt and meet the new way of working. This adaptability will be needed again in the face of an economic downturn.
Novidea stated that firms should be optimising operations, both end-to-end and across the entire organisation. But what are the best ways to prepare?
Lean on company data
It stated that independent agents and brokers have a gold mine of historical data about the company and customers. Firms should be analysing this, as trends will help them inform response plans. It added that ideally the data will tell the firm about their strengths and weaknesses.
Streamline operations
Next, the InsurTech company stated that when a business enters a recession it is time to look for cost cuts and where efficiency can be boosted. It said, “Do you have a clear picture of how much time employees spend on repetitive tasks? Does your back office team struggle with processing claims due to human error? What is the value of reducing time and frustration for your workers and customers?”
The answer to these questions is automation, it said. With the right automation solution, firms can streamline processes and free up employee time. The answer to solving problems during a recession is through technology not hiring more people, it stated.
Focus on retention
The report stated that in a recession, it will be important to keep the company’s best staff. It said, “Over the last two years, agents and brokers have been working remotely long enough to prove that they’re more productive than they were when they commuted to an office. To retain current workers and recruit a new generation of agents and brokers, agencies and MGAs need a resilient work model that is flexible and accommodating to employees, no matter where they choose to work.”
It added that the location of agents is less important when the trade-offs are improved productivity, reduced operational costs and higher customer satisfaction.
Diversify risk product portfolio
Novidea stated that business flexibility and diversity are important to survival. By expanding the suite of insurance products might be the right move, but it is better to examine performance data to see what areas the company excels in. For example, if there is a segment the business does well in, explore other products in that area or find a way to improve it more.
Empower your people
Finally, the report said that employees that thrive in insurance often have certain character traits and work habits. These are a desire for responsibility, attention to detail, strong communication skills and the passion to make an impact on people’s lives.
Novidea said these traits make customers loyal. This is why firms need to keep their best staff. To do that, a firm needs to let them “shine.” This means giving them access to the relevant data and resources they need to make sound decisions that positively impact their customers and the agency’s bottom line.
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