Productive P/C Rating Solutions Needed for Agent-Driven Sales & Service

In an increasingly wired business environment, property/casualty insurers and agents face enormous challenges-shrinking profit margins, new business acquisition and retention costs, and changing customer expectations, among others. Confronted with new marketplace and distribution demands, the industry is exploring emerging technologies to deliver business value, improve return on investments, and better manage customer relationships.

Insurance agents are at the frontline of customer relationship management when it comes to delivering products and services to policyholders and prospects. Most often, the agent is the sole contact customers will ever have with their insurers. The pivotal role of agents as the intermediary in the carriers’ value chain-ranging from quoting, rating, policy issuance to customer care and support-can truly differentiate the carriers they represent from the competition.

Most insurers utilize embedded rating engines for individual lines of business to price coverage in their policy-administration systems. However, the process is neither seamless nor transparent-neither agents nor customers can instantly access prices. This lack of access is further compounded by the fact that many insurers have multiple, legacy-based rating engines, which prevent real-time pricing, quoting and policy issuance.

Given these conditions, business solutions and support processes at the insurers’ end need to be tailored to help insurance agents:
• Identify and retain profitable customers. Market and competitive forces are pressuring the industry to adopt more precise decision-support/analytics that help to evaluate customer inclinations. Accurately pinpointing the most advantageous customer relationships is critical to successful retention and cross selling strategies.
• Generate enterprise value. Insurance agents need better information about customers and advanced tools to collaborate across organizational boundaries. They can be much more productive with technology that helps them deliver superior customer care, anticipate market demands, and quickly respond to sales and service opportunities.
• Improve operational efficiency. With rising transaction volumes and shrinking profit margins, achieving operational efficiency, enabling accurate pricing and reducing marginal costs per transaction are critical.

While there’s no one-size-fits-all solution, flexible, Web-based technology can integrate and strengthen diverse elements in insurers’ point-of-sale and distribution network. This could significantly enhance agents’ customer acquisition and retention of profitable accounts, while improving customer satisfaction and support.

Here’s a look at some characteristics of modern rating solutions that, in conjunction with real time policy issuance and service in the chain of products, processes and decision-support tools, can improve revenue generation by insurance agents.

• Algorithm and Rules Engines. New browser-based rating engines are designed as sophisticated on-demand calculators that can choose from multiple sets of rating loss costs and algorithms to satisfy pricing needs for any line of business-anytime, anywhere and on any platform.
• Efficient Rate Management. A progressive rules-based rating engine has the added advantage of dramatically simplifying ongoing rate maintenance. Rate changes can be rapidly implemented to reduce costs, slash deployment cycles and enhance economies of scale.
• Automated Underwriting. Advanced rating engines also process logical rules for immediate, automated underwriting. Reflecting all custom edits and guidelines, a rules-based rating/underwriting system enables a valid binder to be issued at the point of sale. In addition, the combination of collaborative technology, powered by Web services, allows the specifics of the binder to be easily transferred to the insurer’s policy-management system for immediate and accurate policy issuance.
• Improved Policy Service. Web-based rating software allows seamless workflow across remote locations to service and retain profitable accounts, while enhancing customer care.

The P/C industry continues to experience significant shifts in sales, service and account management priorities. In this evolving business environment, agents, other intermediaries and customers-must become even more interconnected. And, with reliable networked technology and customer-responsive marketing and account management applications, smart carriers and their agents can further leverage opportunities for deeper customer relationships and revenue growth.

Charles J. Boodro is president of AscendantOne, a unit of Insurance Services Offices, Inc. (ISO). AscendantOne delivers browser-based and Web service-enabled sales and service solutions to the property/casualty industry. He can be reached at info@AscendantOne.com.

Topics Carriers Agencies Property Casualty