In a recent editorial in PropertyCasualty360, Ellen Carney, a senior analyst with Forrester, asked ‘In dealing with carriers, do agents feel like they are on their own when it comes to technology issues?’ This is a fundamental question, still relevant since it was first posed over 40 years ago.
ACORD in the US has just celebrated its 40th anniversary. When the organization was first established, the ‘A;’ in the name stood for ‘Agent ‘. That was dropped some time ago for ‘Association’. It is true that the need for standards goes well beyond the agent/broker – carrier relationships. However, it can be argued that the industries in the US and Canada have not achieved the anything close to universal systems integration envisioned by organizations such as CSIO and ACORD.
Carriers who are committed to the independent agent/broker system have to make tough decisions about allocation of resources in support of their distributors. Many commit lots of hours and dollars to work in industry organizations and in their own offices to develop and implement systems to standards. However, if there there is insufficient support for standards from broker management system vendors, lack of interest from brokers, or the companies market products not easily supported by standards – such as mid-market commercial lines – the carriers are pushed to implement proprietary systems.
So what does this mean for agents/brokers themselves? There are still some who feel that technology is not important. However, we think these ranks are shrinking. There are others who invest in internal technology and make the best of it to the exclusion of integrated technology relationships with carriers. To date, this strategy has been effective given the lack of universal traction with standards based initiatives.
But a new generation is coming that are looking to implement standards where they exist, drive standards in other areas, and look to new collaboration methods, such as customer anlaytics and communications , as we blogged on recently.
Time, of course, will show the value of the various approaches. However, in absence of a proven industry strategy, the hedged approach, combined with strong self-reliance seems to make sense.