Paul Davey, Director (Regions) at IDEX Consulting talks about what’s in store for the future of the general insurance industry, and how Account Executives can make the most of it.
As change permeates through the insurance landscape, every area is feeling the impact. From digital transformation, to rising customer expectations and a changing market, one thing is certain - this disruption is impacting every area of the insurance industry. As Account Executives (AE’s) face a rapidly evolving competitor landscape and hard market, they must learn to adapt and grow with it, so they’re not left behind and can reap the rewards of keeping up.
The hard market will continue
The general insurance industry is in the midst of a hard market, which is further compounded by the Coronavirus pandemic. In April 2020, CEO at Lloyd’s of London, John Neal, told the Financial Times that COVID-19 is “no doubt the largest insurance challenge the industry has ever faced.”
As AEs try to navigate a period where the demand for insurance exceeds the supply, it is vital that they manage client expectation and try to be as flexible as possible. Time and time again, we’re seeing customers faced with reduced cover and increases in premium costs of 100-500% which may leave them feeling uneasy or dissatisfied. It’s vital that you are transparent with them and show them all the options - after all, they may not understand the markets. In doing this, you’re managing expectations and strengthening your rapport with existing clients.
Additionally, you should ensure that the company you work for is giving you enough time to focus on those all important revenue-generating tasks, rather than jobs such as broking and admin, that your sales team are responsible for. The company you work for should be able to rely on a good team of sales reps to help you do your jobs.
Digital will disrupt
As digital technology spreads across every area of the general insurance industry, it is vital that companies embrace this digital transformation, otherwise they risk being left behind. Insurers need to move quickly and stay up-to-date with the latest insight if they want to remain competitive.
A new breed of insurance company, InsurTech, are integrating innovation and digitalisation to enhance efficiency and productivity, all while driving down cost. As a result, this is reshaping the way in which the industry operates. If companies want to attract talent and thrive, they need to develop a strategy that will become the foundations of a dynamic and future-proof ecosystem.
However, there’s no such thing as a one-size-fits-all approach, and AEs will need to jump in and learn as they go. Marie Carr, Global Growth Strategy in Insurance and Financial Services, PwC agrees, saying: “No one knows what the perfect new business models are because they haven’t been fully articulated or proven. To find sustainable revenue, firms will need to learn fast, fail fast, and partner as needed.”
Data will drive new clients
As more and more InsurTechs take up space in the insurance distribution network, we will see a rise in insurers who use data and new technologies to offer improved services to their customers and win new clients.
For example, software such as Crystal Knows can help AE’s and Brokers understand how to work with and sell to prospective clients. Using personality AI to DiSC profile prospective clients on social media, it analyses millions of data points and validated assessments to accurately identify someone’s personality. As a result, AEs can make more personalised suggestions and decisions for prospective clients, and strengthen their relationships.
And as a result, personalised insurance products will burgeon.
Digital hasn’t just transformed the way AE’s do their jobs, but the products they’re selling. Personalised products such as Lemonade’s Contents and Liability insurance have been growing in popularity.
According to Startup bootcamp InsurTech, 75% of incumbent insurers “believe the biggest impact to the industry will come from building new products in order to address the changing needs of the customer.”
New insurance companies such as Lemonade are breaking the traditional insurance norms by relying on a mutual insurance model and embracing high-tech solutions. As a result, they can offer lower rates and transparency, which has become a huge hit with their customers.
Account Executives pay will change
The InsurTech revolution isn’t just changing the way in which AEs do business, but how they’re rewarded for the work they’re doing. Companies such as Bought by Many, Lemonade, The Floow and Traceable will pay you in accordance with the books you manage on top of your basic salary, thus rewarding you for the work you do.
New independent insurance companies are rewarding AE’s in a fair manner. We have worked with a number of AE’s making the move from traditional operation to digital and they all believe that there is better pay and benefits available to AE’s willing to adapt.
At IDEX, we’ve got more than fourteen years experience in recruiting in the general insurance industry. Send us your CV and find your next role today.