When we first started working with independent distributors in the insurance industry (around the time the wooly mammoths were roaming Southwestern Alberta), one of the first liquid lunch debates focused around the ownership of the client. We recall that the debate was long, intense, and came to no conclusion. At the recent Insurance-Canada.ca Technology Conference, the same debate arose in two separate sessions, with about the same results (minus the bar tab).
We’d like to offer a modest proposal to bring this to some conclusion. It is less philosophical and, we believe, reflects the social reality that is emerging. We’d like your thoughts.
For our purposes, a client is a party (personal, familial, commercial) that has bought insurance. Sometimes this is extended to a prospect (not having purchased, but in the process of buying).
When the insurance is sold through a direct channel, the party is usually considered to be a client of the direct insurer. However, when the insurance is sold through an independent distributor (agent/broker), the independent usually claims ownership of the client.
In some cases, as one of our expert panelists pointed out, this ownership agreement is part of the distribution contract.
Is shared ownership possible?
Most insurers have not challenged the independents’ position as the client advocate, and have acknowledge that there is ownership. However, as insurers have moved into aspects of client service (claims of course, but also direct billing, etc.), and have started direct to consumer advertising, they have started to poke at the notion of shared ownership.
Few independents are willing to give ground on this, however, and the debate continues, sometimes with great emotion.
Let’s take a short side trip ….
Before the commercial internet came into being, network providers competed for customers on the basis of their individual strengths. Most companies had only one network provider that serviced all of their needs. The networks closely held these ‘clients’.
The down side of this was the inability to link networks without proprietary and expensive work. Email, file access, application sharing were mainly network specific functions.
The internetworking concept stood this on its head. Instead of a proprietary network being an advantage, it became a boat anchor. Initially, email was the killer application for internetworking, but then Tim Berners-Lee came up with an addressing scheme that allowed users to navigate a ‘web’ of applications, files, etc.
In a mere 20 years, this internetworking has become the standard. Pure proprietary end-to-end networks are rare. Security and standards of service have morphed to accommodate a cloud of connections.
And we are better for it. We still select the network that we want to connect to, but these providers embrace, rather than exclude, other network participants.
Now, let’s be social …
On top of this web, we are seeing the maturation of social networking tools. As nodes of connectivity are linked, so are people. Twitter users re-tweet messages from everyone to anyone. My business connections on LinkedIN connect with your connections and we all have more contacts to leverage.
And the social networks are interconnecting. Tweets appearing on Facebook. LinkedIN updates appearing on Twitter.
With little or no thought of ownership.
Is this a model?
Responsible social users take connections seriously. I won’t expose my LinkedIn connections to people I don’t know, for instance. I will, however, refer colleagues to people I do know.
Perhaps this is a model.. I ‘own’ the relationship with my colleague, and I maintain it by not abusing the relationship. However, I don’t own the relationship that that colleague has with others, not even those that I have introduced.
We recognize there are professional and legal obligations between independent distributors and insureds to ensure quality of service. But this does not necessitate ownership, not in our mind.
What do you think?
Is this a start towards resolution of the client ownership conundrum? We’d be interested in your thoughts. Leave a note below.