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Top Insurance Industry Executives Discuss Recession, Social Media & State of the Industry with Young Agents

Annual Young Agents Big "I" Leadership Institute Presidents’ Panel included Fireman’s Fund, The Hanover, MetLife and Progressive Insurance.



Alexandria, Va., Sept. 28, 2010 - The recession isn’t over, but independent agents and brokers are well positioned to take advantage of market shifts. That’s the message a panel of presidents from leading industry carriers shared with young agent leaders from around the country on Saturday.

This weekend, more than 100 young agent leaders gathered at the Big “I” Young Agents Leadership Institute in San Francisco for networking, workshops on social media, marketing and leadership and the President’s Panel breakfast. Participants on the panel included David Daniel, 2009-2010 Big “I” chairman; Karen Barone, Progressive national agency distribution leader; Paul Lonneman, MetLife Auto & Home sales distribution senior vice president; Darryl Page, Fireman’s Fund senior vice president; and Andrew Robinson, The Hanover Insurance Group president of specialty casualty businesses and senior vice president of corporate development and strategy.

Panelists weighed in on a variety of topic affecting independent agents, including the economy, the soft market, social media and marketing. All panelists agreed that while experts report the U.S. has emerged from the recession, agents and consumers are not yet seeing the results. “We are all being told that the recession is over,” Lonneman said. “But has anyone seen any indication that it is over?”

Panelists noted that the difficult economic conditions provide a chance for agents to reaffirm their value to consumers. “The role of independent agents creates huge opportunity to add value when times are tough and economy is tight,” Page said. “The economy has had an impact across all segments—the affluent segment has been immune, but we are now beginning to see [the impact] there as well.”

Coupled with the struggling economy, panelists suggested that the soft market still has not shown concrete signs of shifting.

“There are two indicators that would suggest we’re seeing some shift,” Barone said. “On commercial lines side if we see sustained growth in employment; and on the personal lines side, if we see increased consumer confidence. We haven’t seen those yet.”

Lonneman noted that for personal lines pricing, all forecasts point to low to middle single digit growth, some spurred by new car sales. “On the homeowners side, carriers are more aggressive in pricing, in the 5 to 8% rate increase range, depending on coastal and catastrophes,” he said.

Panelists discussed whether highly specialized niche agents were better positioned to whether the current climate versus more generalist agencies.

“We think specialized agencies have better insight to risks and exposures and are better suited in bad economic times and soft markets,” Robinson said. “Unless you’re in a niche like construction where the macro economics overwhelm everything, we would bet on an agent who has the specialized expertise. In our view, it’s the way to win.”

Daniel agreed. “It depends what niche you are in,” he said. “There is something to be said though for both strategies.”

Regardless of whether agencies are choosing the niche specialization or diversification strategy, panelists agreed that embracing social media as part of a holistic marketing strategy is critical for success.

“Social media will replace some of traditional ways we think about referral and marketing,” Page said. “We are encouraging independent agents to use those tools to drive their success.”

Barone noted that mastering local search strategy, while not technically social media, is critical to agent success online. Consumers need to find independent agents in their online research. “As we think about where consumers are doing initial investigations, when they do Google search, they are doing it with a local intent. You own that space—large corporations don’t have a local presence so they can’t own that space.”

Panelists agreed that independent agents need to harness new technology in order to reinforce their basic value proposition: the role of advisor. “Ultimately the independent agent channel is going to win because it is the advisory channel,” Robinson said. “The key question is as generations move to electronic communications, how can you deliver that same quality of advice through all of these new technologies?”
 
Founded in 1896, the Big “I” is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, and health—as well as employee benefit plans and retirement products. Web address: www.independentagent.com.
 
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