Does Your Agency Need a ‘Coverage Consultant’

Google the phrase “business consultant” and more than 21 million hits pop up available for review. Granted some of these are links to descriptions of what a business consultant is, but the majority of possible sites link to websites for actual business consultants. To prove how big this industry is, the US Bureau of Labor Statistics states that management, scientific, and technical consulting services is currently one of the fastest growing industries in America.

Do we really need so many people telling us how to run our business? Aren’t there scores of books that give us the same information? Business owners have the option of ignoring the books or the experts, and sometimes they ignore both.

Don’t misunderstand, I’m not suggesting that hiring a consultant is a bad thing; in fact bringing in an outside expert with a broad view of business can be very helpful. But to be useful, the consultant must be the right fit for the right purpose – your core purpose – to identify the real problems so the right solutions can be offered. But…

…Agents and brokers do NOT hire the right kind of expertise.

Practically, the key functions of any insurance agency are simple:

• Find suspects;
• Convert suspects into prospects;
• Analyze insurable risk exposures;
• Formulate the correct insurance coverages; and
• Service the business to the highest level.

That’s it!!!

This simple process is often complicated by agency management systems, regulations, processes, and humans having “bad hair days;” but the core purpose of any insurance agency is TO PROVIDE THE CORRECT INSURANCE PROTECTION. It really is this simple.

As proof consider this, when an agency properly analyzes the insured’s risk exposures, designs the correct insurance plan and manages the program well:

• The potential for an errors and omissions claim is greatly reduced;
• Staff morale improves because little time spent patching and repairing a poorly designed program; and the best part
• Producers and the agency become known as trusted advisors rather than just insurance peddlers.

So, if constructing the proper protection is of prime importance (the core purpose) and has so many positive effects, why don’t agencies hire coverage consultants? Might agency owners believe that issues other than their core purpose require greater attention – necessitating the hiring of a consultant?

Let’s compare just two options to find out which is better for the agency AND its clients: 1) training and coaching towards learning how to designing a proper insurance protection program; or 2) training on how to better and more fully utilize the agency management system?

Your clients don’t care if you know how to input information into the system, but they do care if a loss is not covered by the insurance policy they “paid good money” to purchase. Get the coverage right, then worry about how to input it in the system; don’t major on the minor, focus on the agency’s core purpose – exposure analysis and coverage.

Remember, insurance protection is vitally important. If coverage is poorly designed, someone’s or some entity’s life or business could be irreparably harmed. This is not hyperbole, insurance protection is that important.

Where, then, can such expertise be found or developed. I’ve already mentioned one possibility – an independent insurance consultant working with and on behalf of the agency to help them develop a technically sound insurance protection program. Agencies can also work to develop such competency in house, but they must be willing to invest a lot of time in this process; or they can buy the talent by hiring a person specifically for this role.

Once the agency is an expert at performing its core purpose (providing correct protection), then it can focus on the processes and human interactions that surround and support that main, core function. But until its own personnel is expert at designing proper coverage and protection programs, the agency should consider bringing in outside expertise – a coverage consultant.

Topics Agencies Talent Training Development