By embracing technology, brokers of the future can bring efficiency to the transaction and stay at the center of it, serving their clients and their business.
What will brokerages look like in the future? An obvious answer is “different from today." However, the differences that will distinguish tomorrow's brokerages are likely to be less about what brokers do and more about how they do it. A major reason for these differences is changing workforce and customer demographics.
The millennial generation, comprising individuals born between 1981 and 1996, is the largest segment of the working population. As of 2019, there were 73 million adult millennials in the U.S., representing 35% of the workforce and an enormous customer base for insurance products. Millennials came of age during the launch of the public internet, and the oldest members of the following generation, Gen Z, were 10 when the Apple iPhone was introduced in 2007, according to Pew Research Center. The term “digital native" is apt when applied to these generations.
Reaching and engaging these generations will require insurance brokers—and all businesses—to think beyond traditional methods of interacting. Brokers that do not adapt to this reality will find it difficult to capture the attention of millennials and later generations, as potential employees and customers.
By embracing technology and recognizing the needs of their customers, the brokerage of the future will:
- Serve and employ more digitally savvy individuals of all ages.
- Combine digital services with expert advice for their clients.
- Deliver a better customer experience online, by phone or in person.
- Enhance productivity with innovative tools and processes, including an easy-to-use digital environment and streamlined digital application processes.
- Achieve growth through specialization in advice-driven business, such as property catastrophe, cyber and professional liability coverage.
Tips for Future Broker Success
The insurance industry has not historically been viewed as innovative from a technology standpoint. While some brokerages may still be reluctant to fully embrace technology, recent health and economic crises have only accelerated the need to not get left behind.
Consider that 15 to 20 years ago some of the largest and greatest travel agencies probably said, “What's this thing called Expedia?" Now try to find a traditional travel agent.
Here are four tips to help brokers succeed in the future.
1) Commit to innovation. Broadly, innovation is more than adopting new technologies. It also involves embracing new mindsets and adapting workflows that create efficiencies while generating improved results.
2) Explore digital technologies. Not all technologies are created equal. Each brokerage should examine options for digital business platforms that are:
- Flexible: Modern technology platforms developed to integrate with other systems.
- Scalable: Brokerage growth hinges on the ability to deliver more products to more customers, so having technology that can grow along with the business is important.
- Intuitive: In the past, training occupied a lot of time for brokers, particularly on software upgrades. The more intuitive the user experience for a brokerage's technology platform, the less time will be needed to train staff on features and functions while striving to serve customers.
3) Utilize digital insurance platforms. Brokers in the future will need to choose the right tools to deliver products their insureds need. Digital quote-and-bind platforms are an immense timesaver, help brokers present more choices and offer a better experience for users as well as customers.
4) Increased competitiveness. A more efficient broker is better able to compete for customers. An innovative broker is better positioned to compete for young, digitally oriented talent. Building a sustainable, rewarding business is key to attracting not only future generations of brokers but also potential buyers.
Technology is just the next phase of evolution in insurance. Without embracing technology, the insurance industry can't move forward or serve the next generation of employees and customers. Whether a brokerage's perpetuation plan is to remain independent or merge with another firm, using the right technology can be a powerful tool.
For more information and additional resources, including the full “Broker of the Future" whitepaper, visit the Victor Broker of the Future resource page.