Underwriters of the Future Are Constant Partners With Agents, Carrier Exec Says

The future of underwriting will be built on closer relationships between carriers and insurance agents, with carriers working hand-in-hand with agencies to maximize profits from books of business.

That was the word from Chad Combs, vice president of personal lines underwriting for Ohio Mutual Insurance Group. He was a keynote speaker at this year’s Insurance Innovators USA conference in Nashville.

“I believe underwriting today is fundamentally broken. I don’t think that the expertise that we have, the processes that we have, all that we’ve built, is well-suited to solve the needs that we really have as an industry today,” said Combs.

In conversations with agents, it has become clear to him that carriers are not doing nearly enough to focus on an agency’s entire book, or on a geographic region, or on growth areas.

And carriers are often seen as simply reacting to consumers’ claims and agents’ requests. But to truly succeed in coming years, with a younger crop of producers, carriers and their underwriters must become proactive influencers, nudging agents to develop the top accounts, sometimes with years of effort, said Combs, who has been with Ohio Mutual since 2014 and was previously head of standard auto underwriting with Nationwide Insurance.

In most cases, insurance carriers will need to be more than a policy provider and a safety net for agents. That may mean becoming a wake-up call to agencies that are not cultivating the best clients and are not truly growing their books of business, Combs said.

“The underwriter of the future, the carrier of the future, is an expert at empowering agents. That’s what we have to be really good at,” he said.

That means consistent coaching of agents, using analytics and data to help mitigate catastrophic losses, building excellent client profiles, automating some tasks, and actually managing agencies’ entire books of business. The current model of rewarding agents mostly on new business should shift to include more and better renewals.

“Agents are busier than ever. They need to filter through their book and find the three or four policies where they can make a difference,” he noted.

Carriers should be prepared for a key question from agents: “What’s the number-one policy I should touch in order to add maximum benefit,” Combs asked the crowd. “Could you answer that question? These are the kinds of things you need to do if you’re going to actually help that agent move forward.”

That future relationship may mean years of nurturing. Where it often falls apart is not following up with agents, Combs said.

He gave the analogy of giant bamboo plants. Nurseries have found that with some species, they must water the plants regularly, for years, without seeing results. Only after the fourth year will the plant growth explode.

The same holds true for some agencies, Combs argued. Underwriters must keep at it, identifying a few growth opportunities and policies every month until, at some point, the agency has become a top performer.

Some policyholders need more attention than others. For many agents, a normal book may include about 500 homeowner policies. Only about 10% of those may need regular attention or extra work, he noted. Carriers must help agents to recognize those accounts that need the work.

“We have to prioritize,” he said.

Agents, like drivers, may consider themselves to be strong producers. In the near future, it will be the carrier’s job to show agencies how and where they can make improvements, with insights into books of business, training, product strategy and new tech and tools, Combs added.

Once that’s accomplished, carriers can get step back and let the agents succeed, he said.

“The underwriter of the future empowers agents, aligns goals, then gets out of the way,” Combs said. “We have to ask ourselves, do we want to be caretakers, or do we want to push it forward?”

Photo: A panel discussion at this year’s Insurance Innovators USA conference. (IJ)

Topics Trends Carriers Agencies Underwriting