Stop the Rating Madness

Slow, slow, slow. That’s the pace that most agencies are forced to follow when quoting personal lines or small commercial lines using the carrier Web sites. The sites themselves are not slow. As a matter of fact, the speed of getting a quote from providers has dramatically accelerated during the past couple of years. What is slow is the process that most independent agencies must go through to do a decent job for their clients in comparing quotes.

Let’s take a trip down memory lane. We have gone from massive manuals to rapid rater systems to true comparative rating to proprietary systems that do not allow us to input the information in our agency systems and send it to all companies for rating. It’s ironic that all this electronic innovation has led us in a giant circle. We might as well be rating out of manuals!

How do we solve this dilemma? It comes down to one simple act: Agents must demand that real-time multiple company rating become a reality. The Big “I” board of directors adopted a resolution at our winter meeting this year calling for the industry “to accelerate current efforts to implement real-time multiple company rating.”

In my travels this year as president, I have had some interesting discussions with carrier employees. One recurring statement has been that companies are not interested in placing their big money systems in a comparative situation. This type of thinking is simply wrong. As systems have become more and more “sophisticated,” they push more work on agents. Just think of the saved time and effort if we did not have to track the multiple passwords and procedures to access our carrier’s proprietary systems. We could free up time to actually sell more products and round accounts.

If a company is not confident enough to put its rates and coverages into a situation that compares it to others, then maybe the carrier needs to look at what it is offering. Our companies have excellent products, but in many situations, agencies are not aware of rate changes, additional tiering or program changes that a carrier may have implemented. Agents could find out about these changes through comparative real time rating. Technology may also allow a carrier to note changes that would pop-up during a comparison.

The resolution the board of directors adopted is a good starting point to push this issue. You can access the entire resolution at www.independentagent.com/act. Please give this resolution to your company representatives when they visit your office. If you sit on company advisory panels, I urge you to give this document to all the participants. If you attend company-sponsored education programs, bring this resolution to their attention. Talk to your agency management vendor about where they stand on real-time multiple company rating.

It seems to me that someone could make a great deal of money if they could come up with a way to make this demand a reality. If you know a company that can start this process, encourage it to do so. It might even be a good investment opportunity!

If we do not move rapidly on this issue, I am concerned that independent agents will have a difficult time providing consumers with our key to success: Choice. We must be able to compare and contrast our various coverage options. We have had enough work forced down the line onto agents with no corresponding increased commissions for doing that work. The least our companies can do is brainstorm on how to work with our agency management vendors to provide this service.

This resolution came about because of the good work of two Agents Council for Technology members, Bob Slocum from Rhode Island and Steve Spiro from New York. They are also members of the IIABA National Board. This is just an example of the forward thinking that your representatives—both volunteer and staff—come up with on a regular basis.

The Big “I” is the innovator for independent agents. Whether it’s on Capitol Hill, at your statehouse or representing your interests with our company partners, no other organization has the capability to push for change like the Big “I.” If you have any ideas, complaints or praise, I urge you to contact your state national director, the volunteer officers or your state or national staff.

Bill Stiglitz
President