Author:  Lisa Smith
               Tech-Insure Consulting, Ltd.

While we could debate the different definitions, for purposes of this article, micro-sellers are disrupters that are selling policies targeting a niche need or perceived gap in standard policies.  These disrupters bypass the established market distribution channels and offer their products directly online through websites or apps.

Disrupters take aim at specific markets and appeal to these hot topics rather than compete on full packages.  Historically, it was easier for independent agents to let some markets go to specialists that developed more efficient processes for marketing/distribution while brokers and agents redirected their focus back onto their core business.  Think travel insurance or pet coverage.

Now, in the age of online shopping and insure-tech startups, these disrupters are tackling newer areas and pieces of our core markets.  Can we continue to ignore their impact on our book of business?

PRO: These disrupters leverage social media and run large campaigns.  They get conversations going and start dialogues about coverage and policies.

PRO: Their swift-strike approach moves through the sales process quickly.  Consumers get a healthy glow of satisfaction for getting something off their to-do list.  Often, it's as simple as completing a form online and adding your credit card details while the kids are at their music lessons.

CON: Consumers are not aware of their own bigger picture and risk position.  Yes, if they buy online, their task is quickly done, but there is no assessment to confirm that was the biggest risk exposure they had or the most critical and best use of their premium budget.

Case Study

Consider a young millennial who sees TROV on social media. He quickly goes and insures his MacBook. He feels accomplished.  However, he missed that the bigger financial exposure is his liability and wage-earning ability.  If he causes a fire, his belongings can be replaced over time.  The lawsuit for smoke damage to the other apartment units can result in wages being garnisheed for years to come.

 PRO & CON: These disruptors are capturing the attention of the primary companies.  It remains to be seen if these investments are an opportunity to enter the digital distribution markets or if this will lead to quicker innovation in products and coverages by the primary carriers.

Their success demonstrates that we are getting off track.

The sales and distribution process is ripe for disruption.  By and large, we are using antiquated processes that become increasingly expensive each year and run the risk of alienating our market as new generations become our customers and employees. These disrupters see that opportunity and are jumping in.

Somewhere, our core products aren't keep up with the sharing economy and digital world. We aren't always keeping up on our portfolio.  We need to consider this rapidly changing environment and its impacts on our solutions, sales approaches and markets.

Here is a checklist of things agencies that wish to remain competitive will want to consider.

At the Agency Level

• Review and assess product offerings and consider new gaps

1. Identity protection
2. Ride sharing: bikes, autos, RVs
3. Property sharing: home, cottage

• Consider new products to offer

1. Legal expense coverage
2. Pet coverage
3. Umbrella policies (while not new, many agencies do not target this product)
4. Sharing-economy products or endorsements (riders)
5. Smart-home products (includes internet of things/IoT) and usage-based insurance (UBI) solutions
6. Niche products (microbrewery, food truck, other popular niches)

• Sales Workflow

1. E-signature
2. Streamlined quote/bind/issue workflows and processes focused on "ease of doing business"
3. Chat, chatbots
4. Online quote/bind
5. Include steps for up-sell, cross-sell, and portfolio reviews and updates

• Marketing and Service Approaches

1. Social media—position your agency as a resource
2. Self-service portals and online access
3. Work with your carriers to ensure media and joint marketing content is leveraged
4. Appeal to the sharing and social community by demonstrating your commitment to your causes

At the Agent Level

• Know your markets—create topic specialists within your agency

• Position yourself as a trusted advisor—do risk assessments and coverage reviews

• Be current on your competitors and know how your products compare

• Assess your sales scripts, workflows and processes to target different market segments effectively

• Reassess client needs with opportunities to save premiums or to upsell and cross-sell to meet new or changing needs

Some bonus side effects your organization will realize:

• Improved loss ratios from ensuring the right risks are with the right markets for the proper value

• Improved retention rates—clients with multiple policies are less likely to "hop"

• Increased premium per policy with coverage upsells

• Higher referral rates (lower marketing costs)

So, why is this article titled "Back to Basics"?  We shouldn't be competing with the micro-sellers.  We should be taking their lesson to heart and incorporating these perceived gap-fillers into our solutions.  Using our skills, knowledge and drive to help protect our community and their resources and to restore our clients' financial, and often emotional, position after a loss has always been our mission and passion.  Technology is an enabler, but at the end of the day, it's people helping people.