Commercial Confidence: Tech-Powered Growth for Small Agencies
The commercial lines sector offers significant opportunities for insurance agencies eager to expand their scope. In recent years, the annual premium growth rate for commercial P&C lines has stayed steady at 6-8% annual growth, according to McKinsey & Company. And in their sigma global economic and insurance market outlook 2023/24 report, Swiss Re indicates they expect commercial lines to benefit most from rate hardening and expand more than personal lines in the coming years.
Smaller agencies, however, have historically shied away from exploring this territory because they viewed commercial lines as too challenging to navigate and didn’t have the resources needed to manage more complex accounts. Focusing solely on personal lines meant that agents needed to take on a higher number of smaller accounts, which resulted in more work for less reward and hindered the agency’s overall growth.
Luckily, technology has come to the rescue. Modern innovations have made the commercial lines space more accessible and profitable for smaller agencies by providing them with the essential tools and insights needed to embark on their commercial lines journey. Challenges like complex workflows due to manual data collection inefficiencies, limited staffing resources, and a need for more guidance on market selections and placement are easily solved with the right tools.
Let’s explore how technology is empowering small agencies with limited resources to handle more complex accounts and ultimately secure larger premiums.
Scouting New Opportunities
To successfully enter the commercial lines space, agencies first need to equip themselves with the right tools. Comparative rating platforms allow agencies to obtain a multitude of quotes from various insurance carriers simultaneously, all by inputting client data just once. This “one-to-many” approach dismantles significant barriers for agencies with limited staff and resources by eliminating the arduous process of visiting each individual carrier’s portal to retrieve a single quote. Expanded visibility across a broad network of national and regional carriers ensures clients are presented with comprehensive and cost-effective coverage options, strengthening your agency’s ability to compete with larger agencies. Streamlining this initial phase gives your staff more time to focus on deepening client relationships and scouting for new opportunities.
AI-Powered Guidance
Now that you’ve found new opportunities, you need expert guidance to truly take advantage of them. Artificial Intelligence is the knowledgeable advisor your agency needs to gain crucial insights that will help you make strategic decisions and ensure success.
One of AI’s most impactful contributions to your agency as you venture into commercial lines is its ability to help you understand client risks. Beginning with as little as a business name and address, AI-powered tools can construct a detailed risk profile by gathering relevant information from thousands of digital data sources such as industry and company websites, social networks, consumer reviews, public records, and government databases. The wealth of data gathered through this process dramatically streamlines the underwriting process, making it faster and more accurate. It also gives your agency a deep level of insight into your clients’ unique risks and exposures. Pinpointing coverage gaps and rounding accounts becomes much easier and you can ensure your clients have complete protection and are well-prepared for any unforeseen challenges in their business journey.
Once these risk profiles are built, AI can analyze past successful placements to recommend the most suitable carrier markets, ensuring each client is steered toward the optimal carrier for their specific needs. AI-driven tools can also assist with generating renewal notifications for existing accounts, helping agencies identify upsell and cross-sell opportunities. This strategically increases the average number of policies per client, ensuring the agency thrives and clients are appropriately protected.
AI can even streamline your agency’s essential operations, importing lead lists and auto-populating risk profiles so that your agents are free to focus on higher-value client interactions. Leveraging these AI-powered insights will allow your agency to demonstrate expertise and forge stronger client relationships so that you can confidently take on more intricate commercial accounts.
Conquering Commercial Lines The current landscape, combined with cutting-edge technology, presents an unprecedented opportunity for agencies to expand their horizons and conquer the commercial lines frontier. Agencies that have the right powerful digital tools in their arsenal can move beyond manual processes that once hindered their progress and cultivate a more efficient, accurate, and ultimately more profitable commercial lines business.
Anupam Gupta is the Chief Product Officer at ACT Supporting Partner Applied Systems Inc., where he leads the company’s product vision and management teams. He brings extensive experience in driving product innovation and transformation across the technology and SaaS sectors. Anupam has held senior product leadership roles at multiple organizations, where he focused on cloud transformation, data-driven solutions, and enhancing user experiences.