What Captive Agents Transitioning to Independent Agents Should Consider in Agency Management Systems

By Gary Miller | December 16, 2019

There’s a storm brewing for many captive insurance agencies and their agents, and that storm may be lengthy.

As an example, Nationwide is one of a number of captive insurance companies that are actively converting their captive agents to the independent model. Nationwide has announced and is actively shifting entirely to the independent agency distribution model with a projected completion date of July 1, 2020. If you are a captive agent with any company and are now facing the challenge of finding new agency management system software, selecting the wrong system may have injurious, long-term results to your business, so knowing the potential pitfalls and solutions is critical.

The problem is that you don’t know what you don’t know, and it’s not your fault. Is there a Holy Grail available yet for a complete agency management system? Regardless of whether you are a captive or independent agent, let’s examine some essential components and relevant factors that should help you in your search for a new agency management system.


First, software security should be your foremost concern. When evaluating agency management system software, at a minimum, make sure your data is encrypted seamlessly with a high-level encryption called Federal Information Processing Standard (FIPS), a U.S. government computer security standard used to accredit cryptographic modules. What does that mean for your agency? That means even if your agency’s network is compromised, your actual data files are safe.

Your new agency management system should streamline your workflow, not cause bottlenecks.

Compliance is a vital concern for insurance agencies and you’ll probably be under more scrutiny in the future as the independent agency distribution model landscape grows. Make sure your data is protected “at rest and in motion.” When encrypted to the FIPS your clients’ Personal Identifiable Information (PII) and Personal Health Information (PHI) are secure. In addition, verify that all documents put into your new agency management system are encrypted to the same FIPS level. This means all data in every form in your new system is encrypted and protected.

You need to decide what is the best working environment for your agency system from three distinct setup types.

The three setups are:

  1. Local computer install where everything (database and system) resides on a single computer;
  2. Local network install where the database is located on a centrally managed server and your agency management system is located on workstations connected to the network;
  3. A cloud install (data and system are on the cloud) which allows the user to access your system from anywhere they have an internet connection.

What’s really important when choosing a company is that they should provide all three options for you. They should have the ability to easily and immediately convert your system’s setup at any time to fit the changing needs of your agency. If they don’t offer all three options? Keep looking.

Buyer beware of “legacy” agency management system applications, meaning they were originally written years ago. Instead of updating their technology software, some software companies simply continue to patch and sell their old technology as new versions.

Ease of Use

After software security, the most critical factor to consider is ease of use. You can have the most secure system in the world, but if it’s too complicated and unwieldy, it will have a long learning curve, wasting too much of your time, and frustrating users. Ease of use with an intuitive system that has an exceptionally rapid learning curve is a very important factor during the final decision-making process.

Your new agency management system should streamline your workflow, not cause bottlenecks. It should be intuitive, not only to IT departments or your admin, but for all users. It should provide full functionality for every aspect of conducting your business, not only for broad categories such as accounting, insurance documentation, sales management, etc., but for a multitude of sub-categories. A great agency management system should not require large amounts of time dedicated to the tech side but should allow you to focus your valuable time on your clients, building new business, and achieving even greater success.

Speaking of your admin, if not you, they obviously should be heavily involved in the evaluation and final decision-making process. Your new system should have more features and options than you would ever expect to use, because in all likelihood, as your business continues to grow you will need some features later that you don’t need now. That being said, the new system should give the admin full control of customizing those screens, turning on or off the features as needed. The admin should also have complete customization control over the features accessible by each individual user.

Does the software you are investigating require you to exit one system to access another? Keep looking, because that software is a time and money waster.

A user should never need to leave the system to import or export data/documents or complete any other function. Also, email integration and mail merge should be a given within every component with the new system.


Client support is an extremely important factor when choosing an agency management system. Look for a company offering the “Gold Standard” of client support which consists of four levels of on-going support. Those four levels are:

  1. An integrated help manual that consists of screen shots showing you step- by-step instructions for all the various software functions and is available directly in the application 24/7/365.
  2. An online help video library which takes the help manual a huge step further and consists of video clips with voice overs showing you step-by-step instructions for all the various agency management system functions. These videos should be accessible online 24/7/365 or directly from within the application 24/7/365.
  3. An online support request system which allows you to email your questions to the company’s technical support team for answers.
  4. A direct access support system which allows you to schedule a day and time for a member of the company’s technical support team to contact you, and with your permission, directly access your computer, showing you, as you watch, how they are resolving any issues you may be experiencing.

Additional Options

Finally, a deal-breaker factor in your decision-making process is what are your options after the installation if the software does not perform as promised?

Any reputable company should offer you, at a minimum, a 30-day, money-back guarantee.

If not, and they only offer excuses as to why they don’t offer a guarantee, then keep looking.

If they are making excuses before the sale, just imagine what they will be like after the sale if you need help.

If you make the right decision, your new agency management system should successfully support your business for decades to come. To borrow a line from the movie Indiana Jones and the Last Crusade, “Choose wisely.”

Topics Agencies Tech Independent Agencies

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