ALEXANDRIA, VA, March 29, 2021—One-quarter of independent insurance agencies report COVID-19 had a significant impact on their operations, revenue and commercial lines customer base, according to the 2020 Agency Universe Study COVID-19 Impact Summary.
Future One, a collaboration of the Big “I" and leading independent agency companies, has released key findings from the recently completed Agency Universe Study. Due to the coronavirus pandemic and related shutdown orders in 2020, the study was halted in its traditional fielding time in March and re-started in September. The 2020 study included survey questions related to the coronavirus pandemic, released as the COVID-19 Impact Summary.
“Independent agents and brokers emerged as truly essential anchors in their communities during the challenges of 2020, helping their clients and neighbors find security and peace of mind even as they themselves were impacted by the uncertainties," says Bob Rusbuldt, Big “I" president & CEO. “The 2020 Agency Universe Study highlights how agencies can best tackle the continued obstacles and trends in the post-COVID-19 world."
The COVID-19-focused section of the study looks at the pandemic's impact on operations, revenue, staffing, strategies and carrier relationships.
“The study uncovered some key areas in which independent agencies need further support, including finding new business opportunities and offering digital tools and servicing," says Madelyn Flannagan, Big “I" vice president of agent development, education and research. “As the Big 'I' continues supporting its members, we look forward to partnering with the brightest minds in the industry to provide the critical resources, tools and solutions needed to adapt to the current business environment."
Key findings from the 2020 Agency Universe Study COVID-19 Impact Summary include:
- Small and newer agencies took the brunt of COVID-19's impact. About one in four agencies report COVID-19 had a significant impact on their operations, revenue and commercial lines customer base. The pandemic was more likely to impact the revenue of small agencies (34%) and newer agencies (32%).
- Absence of disaster recovery plans belies preparedness perception. Nearly half of respondents believe their agency was well-prepared to deal with COVID-19's impact on their business—despite only 1 in 20 having a disaster recovery plan that included pandemics. Smaller agencies were least prepared to deal with the pandemic at 33%. Nearly half of those with a plan will modify it, but only 1 in 5 without a plan expect to create one. Newer agencies are less likely to have had a disaster recovery plan (22%).
- Building an online presence is crucial. Going forward, building an online presence for marketing and implementing or improving online business tools are the most important factors in succeeding in 2021. Building a digital presence is more important for small (65%) and medium-small (61%) agencies. Jumbo agencies cite implementing or improving home-based tech for remote workers (46%) and developing strategies for opening the office safely (29%) as important. Newer agencies are more likely to cite building an online marketing presence as important (80%).
- Independent agencies need support with business opportunities and digital tools. Top areas needing support because of the pandemic are finding new business opportunities and offering digital tools and support with digital servicing. Small agencies are more likely to need support with handling personal lines clients' calls and service requests at 23%, while jumbo agencies are more likely to need support leveraging risk control services to identify new areas of exposure due to the pandemic (23%) and providing guidance about the crisis and coverage (28%). Newer agencies are more likely to need support with finding new business opportunities at 56%.
The 2020 Agency Universe Study is the fourteenth in a series that was first conducted in 1983. Since 2002, the study has been completed biennially. Since 2004, the Agency Universe Study has relied on internet data collection. In total, 1,437 respondents were included in the 2020 study, conducted by Zeldis Research in cooperation with Future One.
To order a copy of the 2020 Agency Universe Study Management Summary or the COVID-19 Impact Summary, providing an overview of the highlights from the complete study, visit the Big “I" Agency Universe Study webpage.
In addition to the Big “I," the Future One coalition includes the following company partners: Allstate/Encompass, Amerisure, Central Insurance Companies, Chubb, CNA, Foremost, Grange Insurance, Hartford Steam Boiler (HSB), Liberty Mutual Insurance/Safeco, Nationwide, Progressive, Selective, The Hanover Insurance Group, The Hartford, Travelers and Westfield Group.
In response to the coronavirus pandemic, the Trusted Choice® COVID-19 Relief Fund provides critical relief to independent insurance agencies and brokerages, owners and employees experiencing significant economic disruption or financial distress as a result of the COVID-19 pandemic. Since April 2020, the fund has assisted approximately over 750 agencies. Grant applications are currently being accepted.
Founded in 1896, the Independent Insurance Agents & Brokers of America (the Big “I") is the nation's oldest and largest national association of independent insurance agents and brokers, representing more than 25,000 agency locations united under the Trusted Choice® brand. Trusted Choice independent agents offer consumers all types of insurance—property, casualty, life, health, employee benefit plans and retirement products—from a variety of insurance companies.