Digital Divide: Young Agents Versus ‘Old’ Agency Principals

By | April 16, 2012

Are Today’s Young, Vocal Agents Trying to ‘Occupy’ Insurance?

Young producers are essential to the survival of the independent agency system. They are enthusiastic and motivated, and if you can put up with their “young versus old” histrionics, a lot of fun to work with.

This exciting new breed of agent prefers to communicate, market, and sell mainly by digital means. They voice their views via social media, trade articles and conferences. The key question is … is their social drive pushing the industry forward, or are they underestimating the wisdom of their elders? Maybe both.


Some young agents proclaim that veteran property/casualty execs overlook the influence of instant online information and the communicative power of social media. They see insurance consumers buying from direct carriers, like GEICO, a heavy investor in these channels. This failure to adapt and spend, they posit, is why they worry about the future of the independent agency system.

Old school principals, they lament, eschew Internet-based selling for traditional marketing and referrals. And when their agency is online, its presence may be outdated and ineffective. They demand better.

Everything’s Online

Some believe that consumers can web search for everything they want to know about insurance and don’t have to query agents for information. This, in their view changes everything. But getting all of one’s insurance advice from the Web isn’t the smartest move, as online information isn’t vetted. Certain sites provide basic coverage definitions, lists of discounts and instant quotes, but price-only buyers are not the most loyal insureds.

The services of the independent agent aren’t so easily replaced. Their knowledge and skills are valuable and flexible enough to maintain and grow this classic distribution channel.

Insurance Spring

Strident young pros proclaim the agency business is in jeopardy; worried it may vanish in their lifetime. Social media and advances in industry technology are the saving answer. And the older generation is not merely holding them back; they are killing their future. Social media messaging promotes their case and foments the overthrow of the “old ways.”

But it’s tough to be a radical while wearing a tie. So, younger agents must satisfy their rebellious zeal by claiming the future as their exclusive territory.

Guess what. The future is always about the young.

Many of their concerns are valid; they just aren’t revolutionary.

A Litany of Threats

Independent agents have been threatened by change for decades. In the 1960s it was the rapid growth of the direct writers. In the ’70s, it was the advent of bank-owned agencies and mass merchandising (group P/C). In the ’80s, it was the introduction of in-house computers for rating, marketing and management, as well as nascent digital marketing on AOL, CompuServe and Prodigy. In the ’90s, it was email and websites. In this century, it’s web 2.0 and the explosion of social/mobile media.

Independents know how to survive. They recognize they must continuously invest in advancing technology, some more than others, of course. And as popular as social media is, it’s still evolving. Facebook and Twitter dwarf once fashionable sites like MySpace. Players like Google+ and Pinterest are up and coming, but untested. There is still time for agencies and carriers to move forward digitally, without abandoning effective traditional tools. Besides, social marketing isn’t free. It requires substantial investments in time and content.

The Big Picture

Insurance operations are fiscally conservative as there is so much at stake. It’s vital for agencies and carriers to keep up with the digital evolution and to communicate and fashion products in the ways that buyers want. But before the new overthrows the old, the industry’s historical landscape must be understood. Plus, it’s always been production, retention and profitability that count the most, and this will never change. The agency business loves its young, but alas, no one is young forever.

About Alan L. Shulman

Alan Shulman, CPCU, is the publisher of Agency Ideas® sales and marketing newsletter (free basic subscription at He is also the author of “500 Sales Ideas for Commercial Lines Producers” among many other P&C sales resources. Email: Website: More from Alan L. Shulman

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Insurance Journal West April 16, 2012
April 16, 2012
Insurance Journal West Magazine

Big “I” Issue with Young Agents Survey; Medical Professional Liability; Business Interruption / Business Income; Bonus: Education & Training Directory