Tom Ross, CRIS, CPIA (217) 321-3003 - tross@ilbigi.org
Carol Wilson, CPIA (217) 321-3011 - cwilson@ilbigi.org
How Does It Work?
n Envision’s proprietary system enables brokers to present unique benefit programs not available through any insurance company
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n Envision’s innovative reporting capability is designed to enable management to make informed decisions concerning their employees’ healthcare costs
Young and “Young” Agents
Let’s talk Young Agents. Our future, so to speak. When I hear young agent, I think 55 and under, as I am 53, while others may think 40 and under. But remember, 40 is the new 30, so is 50 the new 40? We are in the midst of highlighting 40 UNDER 40. So, is that the bar?
I personally think that anyone in the business for less than ten years is a young agent, whether you are 60 or 18. Learningwise, you are both in the same situation and have much to learn. I know it is harder for the 53-year-old (me) to learn than it is for the 18-year-old (my son) to learn. However, we can both learn, and that is what makes us valuable to our potential respective agencies. While my son may bring more energy and enthusiasm, I bring wisdom(grey hair) and refined people skills. It would be hard for my 18-year-old to relate to a 55-year-old business owner with two kids in college, a mortgage, and ten employees who rely on them to earn a living. Whereas I could relate to that and could better discern how to approach that prospect. So do not box young agents into the 18-40 category, as an older person new to the business is truly a young agent as well.
Young agents, as I define them, are baby birds waiting to take that inaugural leap from the nest after much guidance. What that guidance is like looks much different in each case. You will be tested in your leadership, mentorship, and eye for talent skills by seeing how many fly before they go headfirst into the ground. Many young agents are turned out into the
wild much too soon. A sink or swim mentality, which may work on some as some strive under pressure. Many may fail though even if you took the time to properly train them in all aspects of the business such as product knowledge; various coverages; sales techniques; organizational skills; people skills; and teamwork to name a few. You can find training for all of these things as well as by leading by example. How important is education to you? Underlings typically mimic what they see every day, especially if you are a wellestablished and profitable agency. You can obtain all of those previously mentioned characteristics through educational courses, designation programs, conferences, good old oneon-one, and group training.
So set great examples for those young agents as all these things will help make those proverbial first flights much more successful. The days of hiring someone and throwing them to the wolves are over, especially in this extremely hard market. Sink or swims are more likely to sink and the more that you have sink, the more likely you are to sink. To go through the motions of hiring multiple times, only to have them fail, might say something about your processes more than it says about you. Find the right talent and give that talent every opportunity to succeed. If they don’t succeed, it may have been them and not you. I heard an interesting analysis from a sportswriter about Patrick Mahomes. They indicated that had
Rather than attempt to be all things to every kind of business, we focus on the ones we know best—restaurants and bars, grocery and convenience stores, medical clinics and auto service shops—to deliver outstanding property, casualty and workers compensation insurance. Deep niche expertise, with insight into unique business risks, is how we cover the details that make the biggest difference to our policyholders.
To discuss an agency appointment, give us a call at 888.5.SOCIETY or visit societyinsurance.com DELIVERING MORE BY FOCUSING ON
the Bears chosen Patrick Mahomes he would probably be part of trade talks and wanting to draft another quarterback and he would have been to no playoff games. Be the Chiefs and not the Bears. Give those young agents as many feathers as possible before embarking on their bottoms(that’s me cussing) and getting kicked out of the nest.
One way to ensure success is to have your young agents attend the 2024 Sales & Leadership Conference (formerly EDGE) this April. The curriculum focuses on sales and networking, which are invaluable to a young agent, making it invaluable to you and your agency. I know times are tough and money is tight, but doing it (hiring and onboarding) right the first time will save your investment and not lead to you having to start over in the process. If I told you it cost you $5,000 to train the right employee who will increase your revenues by 15-20% or you would have to hire five employees who will never amount to more than a 5% increase in revenue, I would bet you would choose option number one. Find that fit for your agency (every agency’s fit will be different) and covet them like the holy grail. Give them every opportunity to succeed, and then you can take solace that your agency is in great shape, your customers are in great shape, and you can turn your focus to growing and perpetuating. The 2024 Sales & Leadership Conference is a great start in getting those birds to fly so do not miss out on this opportunity.
Did I mention that this year is our 125th year in existence? No, but you may have seen it in one or two other places. To put it in perspective, we are older than Boeing, UPS, LL Bean, Harley Davidson, Kraft Foods, Chevrolet, Ford, Dodge, Target, and Walmart, to name a few. That’s impressive, to say the least. 125 years would not have been possible without substantiative participation, leadership, and guidance. Big I Illinois is set to go for another 125 years with your continued support and involvement. I can tell you I will most likely not be around for the 250-year celebration, but I can imagine it will be glorious as well. That will only be possible if we all work together as we always have and keep passing the torch to the new generation of agents.
There is no better time than now to get those young agents involved in your association by merely leading by example. Show them the importance of the ASSOCIATION (BIG I Illinois), peers, and resources. Get involved more than you ever have, as this market will ultimately make us all stronger. WE ALL WILL get through TOGETHER - from Agencies, Agents, Associate Members, and our Company partners. Nobody is immune to these conditions, so think of it as an intertwined net as opposed to individual strings, and this storm is only going to strengthen our resolve for ourselves and each other. We are stuck in the mud and we all need to get out and push and any other cliché you can think of.
As always, this just Brett’s 5 Sense (who are we kidding, this is probably the new normal) and I hope it was helpful. If you need any clarification or have any suggestions for future articles please email me at bgerger@ilbigi.org.
Industry Opposes Legislation During House Insurance Committee Hearing
On Monday, February 26th, the House Insurance Committee met for a subject matter hearing on two pieces of legislation, HB 4611 and HB 4767. The hearing was held at the Michael A. Bilandic building in Chicago as proponents and opponents testified on the proposed legislation.
HB 4611 was introduced on behalf of Secretary of State Alexi Giannoulias. The proposed legislation sets forth a review process for car insurance rate increases and mandates that insurance companies’ base rates on an individual’s driving record rather than non-driving factors in setting auto insurance rates. Secretary of State Giannoulias testified at the hearing and states that the current law permits insurance companies to utilize data obtained from external sources and algorithms, resulting in higher insurance premiums based on race and other socioeconomic factors.
HB 4767 was introduced by Rep. Will Guzzardi on behalf of the Illinois Public Interest Research Group (IPIRG). The proposed legislation would restrict auto insurance underwriting and rating practices that use nondriving factors and allow the Illinois Department of Insurance the ability to reject or modify rate increases. The bill would prohibit insurance companies from refusing to issue or renew a personal auto policy based on prohibited factors, including sex or gender, marital status, race, creed, national origin, religion, age, occupation, education level, home ownership, credit reports or scores, and the absence of prior insurance.
Testifying on behalf of the insurance industry were representatives from the National Association of Mutual Insurance Companies (NAMIC) and the American Property and Casualty Insurance Association (APCIA). In addition, Roosevelt Mosley who is the Principal and Consulting Actuary for Pinnacle Actuarial Resources and Lynne McChristian, Senior Instructor of Finance and Director of the Office of Risk Management and Insurance Research for the University of Illinois testified on behalf of the industry.
By Evan Manning
The insurance industry stated in their testimony that both bills claim to seek insurance accountability and fairness. Yet, if insurers are unable to utilize risk factors when determining rates, it will lead to a one-size-fits-all approach to pricing, eliminating competition in the marketplace, and ultimately driving prices up for all consumers. The industry noted that Illinois’ auto insurance market is one of the most competitive if not the most competitive in the country, with around 280 insurance companies offering policies in Illinois. This competition helps to keep rates in the state low, as Illinois auto insurance rates are 15.5% lower than the national average.
While I was at the committee hearing in person, I did not offer testimony but was available for any questions from committee members. Big I Illinois will continue to work with our coalition partners on the proposed legislation. Be sure to sign up for Insurance Industry Legislative Day on Wednesday, March 13th in Springfield to learn more about these pieces of legislation as well as several others affecting the insurance industry. Register today at https://www.insurancelegislativeday.org/
Evan Manning is the Director of Government Relations for Big I Illinois and can be reached at emanning@ilbigi.org.
Wednesday, March 13 Springfield 2:00 - 5:00 pm Education Session (CE)
5:30 - 7:30 pm Reception with Legislators
Governor Pritzker Delivers 6th State of the State and Budget Address
By Evan Manning
Governor Pritzker delivered his 6th State of the State and Budget Address on Wednesday, February 21st. Speaking to both the Illinois Senate and House of Representatives alongside the constitutional officers, Governor Pritzker outlined his budgetary and substantive legislative agenda for Fiscal Year 2025 (FY25). It was quite obvious the Governor has his sights set on the health insurance industry, outlining three parts to his health insurance reform package initiatives for spring session.
Pritzker’s “Healthcare Consumer Access and Protection Act” will include a package of proposals aimed at several different legislative initiatives in the health insurance industry. Pritzker said in his speech that he expects stiff resistance from the insurance industry and says that he is prepared “to spend serious political capital and put my shoulder to the wheel” to pass the legislation.
The first part of the package targets what Pritzker referred to as “utilization management” which is the practice of evaluating and monitoring the use of healthcare services to assess their appropriateness and quality. This includes “prior authorization” which is the requirement by health plans for patients to obtain approval of health care or medication before the care is provided. Pritzker will propose banning the use of prior authorization requirements in one specific area of health care – in-patient mental health care for both children and adults – making Illinois the first state in the nation to do so.
Pritzker will also call for an end to another kind of utilization management, so-called “step therapy” for prescription drugs. Step-therapy is a process where patients first try one or more alternative medications before accessing the medicine prescribed by their provider.
Pritzker’s plan also calls for banning the sale of Short-Term Limited-Duration Insurance (STLDI) plans in Illinois. Pritzker referred to these plans as junk insurance plans. STLDI plans are often utilized by people to fill gaps in coverage, such as when they’re transitioning from one job to another. These plans are a cheap alternative for individuals in the short-term to have some type of health insurance coverage instead of going uninsured. But while they are often less expensive than regular insurance, they are exempt under federal law from many requirements of the Affordable Care Act such as prohibitions against discrimination on the basis of preexisting conditions or monetary caps on benefits.
Another part of Pritzker’s proposal would require insurance companies to regularly update their network directories to make sure the providers listed are part of the company’s network and are available to accept patients.
Finally, Pritzker’s plan will call for giving the Illinois Department of Insurance authority to review, approve, or reject proposed rate increases in the large group market, which includes plans that cover 51 or more employees of an organization. Last year, Pritzker signed HB 579 (P.A. 1030103) authorizing the department to conduct rate reviews for policies covering individuals and groups of 50 or fewer employees.
The Governor’s budget addresses the recent implementation of the State Based Marketplace. P.A. 103-0103, signed into law in June 2023, authorized the creation of a state-based marketplace for Illinois, which gives the State the authority to create it’s own health insurance exchange.
SBM will go live for plan year 2026. The Affordable Care Act (ACA) Open Enrollment Period begins November 1, 2025. During the interim year, the State will advertise, provide consumer assistance, begin staffing and building IT infrastructure for the marketplace. The proposed FY25 budget includes funding to support staffing, consumer assistance navigators, marketing and advertising, and costs for an enrollment website. $17.8 million to the Department of Insurance (DOI). $6 million to the Department of Healthcare and Family Services (HFS).
Funding increases to $6 million for Get Covered Illinois, to expand the State’s marketing and outreach effort to assist consumers in accessing healthcare. Close collaboration between DOI and HFS will aid individuals moving between Medicaid and the marketplace, avoiding potentially devastating coverage gaps.
The recommended budget includes funding to increase the DOI authorized headcount by 29 to aid the department in regulation and the administration of the State Based Marketplace. The recommended budget also includes an increase of $3.1 million for the rollout of the new DOI Consumer Complaint Help Center and promotion of the DOI’s consumer protection function.
Big I Illinois has always and will continue to work with the Governor’s Office and the Illinois General Assembly on legislation affecting the insurance industry, our agents and brokers, and your consumers. If you have any questions or concerns about any piece of legislation, please do not hesitate to contact me.
Evan Manning is the Director of Government Relations for Big I Illinois and can be reached at emanning@ilbigi.org.
Celebrating Association Trailblazers
As we commemorate 125 years of our association’s rich history, we are honored to shine a spotlight on the remarkable achievements of our Association Trailblazers. From the first Black president to the inspiring strides made by female leaders and our youngest president, these trailblazers serve as a reminder of the significance of representation and diversity in leadership. Through their journeys, we’ve gathered invaluable insights and inspiration that allow us to continue to serve our membership in the best way possible, as well as support all independent insurance agents throughout the state.
SHARON HEATON PIA President - 1988-1989
How did you get into the industry?
I was working in systems heading up a project for Country Companies. The head of sales for the state literally came to my office weekly to try to convince me to become an agent. He wanted to have a female agent in the state before State Farm did. I was getting married so was going to move. IBM offered me a job in Boston and Chicago. The head of sales had told me I could go anywhere in the state. So I thought why not try being an agent. My husband had offices in Chicago and New York so I requested as far from the city of Chicago as possible but still close to O’Hare and still have trains available into the city. That landed me in Kane county. Of course they had no need nor territory for an agent in Kane county so I also started as a scratch agent. But, Country Companies beat State Farm on employing the first female full time agent.
How did you get involved with the association?
After 10 months of selling for Country Companies I realized what a captive agent meant ... l couldn’t always provide the right products to meet my clients needs and I didn’t own my business. So, that’s when I went independent. We were again in a new area, Pontiac, IL. A fellow agent in a neighboring town invited me to an agents meeting they were having in Livingston County so I attended and that was the beginning of my association life.
Was there someone that you leaned on for guidance or support in career?
I have to admit that I really didn’t have much background in insurance products since I had been in systems work prior to becoming an agent. My husband was a great help in educating me as his background was underwriting and reinsurance. He was also very encouraging when I was starting out as a scratch agent and knowing no one in the area. When he would come home and I had newspapers laid out on the floor open to the want ads, he would always encourage me that I could do this and not to give up! I also had great support and help from my fellow agents in the association. Their help was very important to me.
What were the major issues while president?
Mandatory auto was one issue. But probably one of the most pressing issues was our future with CIC. We had a contract to do CIC in IL and offered a discounted rate to our members. That became a major issue with CIC and came to a head that year. We finally came to an agreement with CIC and maintained the license.
Were there challenges you faced as a female agent?
Actually, I can’t recall any real challenges. If anything, it was an advantage being a novelty in getting people to work with us. I do recall me when I was at a legislative function in DC and a member of another organization looking at me and stating “We have thought about maybe getting a female involved.” I just laughed it off and he ended up being a good friend.
What were the benefits from association involvement?
The benefits were many!! The education piece is invaluable. But, I think the legislative efforts of the association and it’s members is so important! The legislation that is passed can impact our businesses more than anything and it is very important that we stay very active and involved to try to influence things we need in legislation and to avoid what can damage our clients livelihoods as well as our own. Most important is the friendships that have been made and continue throughout life!!
What would you tell someone who was considering getting involved as a volunteer? DO IT!!! The more you give, the more you will get in return!
JULIE HEARRING PIIAI President -
1998-1999
Tell us a little bit about your background. How did you get into the industry?
After returning to Olney with my husband and small daughter in 1977, I joined my father’s Agency to help him out for a little while. I was helping until I could decide what I was going to do permanently. Many, many years later, here I am still working in the Agency, of which I am now owner and thinking of retirement!
What challenges did you encounter as a woman in the insurance industry?
The biggest challenge I encountered was getting people to take me seriously as a young woman. At the time I joined the firm, women were still not looked upon as “owners, managers” and I was young, which compounded the situation. I took it as a challenge and began trying to learn everything that I could to better myself. Knowledge is power and my father reinforced that over and over. He gave me every opportunity to learn that was necessary and to expand my frame of reference.
How did you first get involved with the association and who or what, or who, prompted you to go through the chairs and serve as president?
I began by tagging along with my father to his committee meetings to see what they were doing. Eventually, I was asked to become a committee member of Personal Lines, then Young Agents, and other committees. It followed that I was then asked to Chair the committees and the rest is history. My father was my biggest champion, encouraging me and allowing time for the Association work. We often traveled together and worked on Association work together.
Can you describe what the PIIAI was like during your presidency? You were the first female president of the merged association, but the merger had happened several years prior. Were all aspects of the merger settled/running smoothly? What were the major issues being discussed in the industry? Truthfully, it was a rather stressful time getting through the merger; however, once we determined to go forward, the group worked together to overcome any disagreements. I think this can be witnessed by seeing the great friendships that were bonded at the time. During my year as President, I can say there weren’t many struggles with those issues. We were trying to bring in new ideas and services to benefit our Agency Membership. There was a new communications program which was to bring awareness to the public of who Independent Insurance Agents were in an advertising campaign. As is still the case today, the Government Affairs committee was hard at work with the Legislature resolving issues and helping them understand who we were and what we stood for.
At that time, we had Technical Committees: Personal Lines & Commercial Lines which worked with actual policy forms and content. They were my passion and always have been. I began on the Personal Lines Committee and worked with suggestions for coverage, changes in forms, etc working with ISO and the Mid-America Technical Conference Committee to get this accomplished. Dad, Chuck Schramm, Ron Whitaker, and many others worked on these committees. Dennis Garrett was our staff contact and he often elbowed us for digging deep into the forms and language. Urban Agents and Young Agents Committees were striving to include a broader spectrum of participants: women, urban agents of color and ethnicity and were reaching out to be more inclusive and build our brand as Independents. The biggest struggle and challenge was setting up the Agents Mortgage Services. This was our endeavor to get into the Financial Services realm. It ended up being a source of great anxiety to all of us on the Board and leadership and was eventually closed out. During my year, Dennis Garrett and Ralph Swank were successful in getting the Agent Bonding Program going, which we still use today. Also, the Premium Financing Program was setup and that was also very helpful to many agents. These have been very beneficial to our member agencies. It was obviously a year of great teamwork, and I acknowledge that I had a great team in the Board of Directors and Staff.
It is interesting that you were president during the 100th anniversary of the independent agents association and your daughter is president during the 125th anniversary. I am quite proud that Allyson has chosen to work on the Board and go through the chairs. I am proud to have her represent our industry as President of the Association. She is a strong advocate for our distribution system and all that we stand for. My dad would have been so proud to see this – indeed, he did see her working on the Board and loved it!
What do you think the future holds for the insurance industry?
This industry is ever changing and should be, as risks develop and our world around us changes. It can also be very s-l-o-w to change when we want it to. That has always been the case from my father’s time through mine and my daughter’s time. I believe firmly that the Independent Agency System provides great value to our customers. We need to continue looking for ways to advocate for and assist our customers. We need to remind our company partners of this and work together to provide excellent products in the marketplace. And finally, we need to support each other, sharing the message of what we stand for as we move forward.
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Celebrating Association Trailblazers
Ryan Hite
IIA of IL President - 2018-2019
How did you get into the industry?
I was born into it! Growing up with parents that owned an agency became an opportunity to learn, work, and get licensed very early. Even though it wasn’t necessarily my career intention, I looked at a difficult job market upon graduating college and I had more insurance experience than most 22 year old’s. Fortunately, a carrier partner was hiring in Peoria and after spending a few years learning claims, underwriting, and marketing, I transitioned back to the agency/sales side.
How did you get involved with the association?
I believe in being active within my community and serving where I can be helpful. That includes where I live, the people I love, and my career. I started in the Association by attending classes and going to the convention. I met some amazing people that I looked up to and respected in our business and when they asked for help I raised my hand. What really made the difference for me was attending our State and Federal Legislative events and then asking to attend and observe a Board meeting to learn more. Shortly after that I was asked to serve as Regional Director and then Rick Sutton and Cindy Jackman approached me about going through the Chairs. I’m forever grateful to them!
What challenges did you encounter as the youngest person to serve as association president?
One of the most difficult things to navigate during that time was having a young family. I wanted to meet as many members and attend as many events as I could to learn and advocate for our industry. Planning that time away from my family and business was difficult at times and I wish my wife could have shared in more of those experiences with me.
What were some of your goals or initiatives for the year you were president?
My two main goals were finding ways to attract more young people to our industry and helping members navigate changes in demographics and diversity.
In what ways have you or your business benefited from involvement?
I’ve always said that I benefited way more than what I invested. First and foremost, the relationships built by serving together are incalculable. Education is a little easier to measure, but it goes far beyond CE/classes and develops into markets, trends, and awareness where you wouldn’t otherwise have knowledge. Very eye-opening to me all along was the direct impact political advocacy has on our business… there are too many examples to list but being involved gives you the opportunity to help create, shape, or veto potential changes and also establishes good working relationships when valuable input is needed.
What is your biggest prediction for the future of the industry?
The industry will always be relationship driven. Technology will change and we will continue to evolve our processes and practices, but caring for the customer and understanding their needs is not replaceable. I also believe that independent agents/brokers are perfectly poised to adapt to the market, respond quickest to needs, and become the primary distribution channel for the industry.
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Charles Hilson
IIA of IL President - 2013-2014
How did you get into the industry?
I entered the insurance industry through the door of ‘providential failure.’ The summer before college graduation, I was promised a position as an account executive in a Chicago advertising agency that I was interning with. That job evaporated a month before my actual graduation.
After nearly a two year job search it became clear that the advertising industry was inviting me to seek a career elsewhere! My primary ‘new career’ criteria was a company willing to make a ‘significant investment’ in career training and development.
The St. Paul Insurance Companies and their six week training program was the perfect answer. This launched a ten year career with some of the finest insurance carriers in the industry. I worked in underwriting, marketing, agent development and national sales.
I’ve always thought my experience equity with insurance companies was my ‘unique service proposition’ as an independent agent! It has always been my goal to represent and champion every member of my client’s “service circle.”
How did you get involved with the association?
My son joined our family agency directly from college - (contrary to my ‘let the carriers train you first’ advice). I wanted to expose him to the broadest professional universe - the association was the answer in terms of professional development and industry horizons.
Eventually, I had to practice what I was preaching as regards industry engagement. As they say, the rest is history.
What were some of your goals or initiatives for the year you were president?
I wanted to align the Association with our evolving client and emerging agency base. That involved greater diversity in our leadership and staff. As well as a broadening of Association focus regarding the industry growth occurring north of I-80.
But my greatest unstated goal was that during our tenure, the Association would be a ‘leader’ i.e., local communities, legislatively, culturally, etc. - rather than a ‘reflection’ of surrounding norms and standards.
In what ways have you or your business benefited from involvement?
Professional curiosity and development define the parameters of an Independent Agent / Agency. The state and national associations offer unparalleled professional and peer resources. Every major industry issue which my business has faced in the past 30 years - the Association has championed locally and nationally.
Personal wealth can be measured in the value of relationships. Much of my wealth in personal and professional equity can be attributed to my years invested with IIA of Illinois.
What is your biggest prediction for the future of the industry?
‘Leaders’ will determine the course and outcome of our industry and nation.
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ARTIFICIAL INTELLIGENCE in the INSURANCE INDUSTRY
Artificial intelligence is quickly moving into a wide range of industries, and the insurance sector is no different. AI in insurance is an opportunity for those that embrace it properly, using it in a number of ways to achieve better and more efficient results. When it comes to AI, insurance industry professionals will see it playing a role in a vast number of aspects, including improving operations, bettering customer experiences, and optimizing risk assessment.
Understanding AI in Insurance
AI in insurance is the incorporation of artificial intelligence tools that do some or all of the work people do to evaluate and manage industry tasks. Just a few years ago, it was very common for insurance professionals to spend most of their time – not just some of it – managing paperwork, completing claim documents, and managing a long, drawn-out claims process. AI reduces the human-workload while getting the necessary tasks completed.
There is an importance to incorporating AI into the insurance industry. It’s not just a nice feature but a very important business model that’s become crucial to companies. AI is capable of empowering companies to make the best use of every minute of the day, allowing them to streamline most processes. This leads to:
• Reducing labor costs
• Improving data analysis and access
• Improving decision making by putting more data pieces together
• Creating personalized experiences for clients
• Automating tasks with efficiency
• Reducing human error
By Loss Scan
Most importantly, it frees up your highly valuable employees to work in tasks that require more human insight and decision making, covering gaps in labor and improving customer service opportunities.
Benefits of AI in Insurance
Take a closer look at how AI and machine learning in insurance is changing the way companies operate and creating a bottom-line level of improvement.
Streamlined Claims Processing
The bane of any insurance adjuster’s workday is processing claims. It is a long, drawn out process requiring adherence to very strict steps. AI can automate and expedite claims handling processes not only to reduce the workload of employees but also to ensure more accurate and efficient completion of this task.
The end result makes clients happy – the claims settlement process is faster. That also leads to overall customer satisfaction.
Improved Risk Assessment
Insurance companies also can use artificial intelligence insurance tools to gather more data faster. This means that AI algorithms can be designed to provide better insight into risk, allowing for faster but also more thorough analysis of risk and better decision making as a direct result. This ultimately leads to better underwriting decisions and improved portfolio management. That creates better results, including a clear picture of what can be expected over time. For many companies, improving risk means remaining competitive in a tightening market.
Fraud Detection and Prevention
Fraud continues to be one of the most challenging aspects for some insurance companies with no simple, well-defined way to minimize risk. However, AI and machine learning for insurance can drastically help. It can pick up patterns and anomalies within data that seem out of the ordinary enough to trigger further evaluation. This allows for earlier detection of fraudulent claims and actions and, ultimately, minimizes losses for companies. Over the long term, that helps keep costs down for customers, too.
Enhanced Customer Experience
Insurance AI tools can do many tasks to improve customer relationships.
• Intelligent chatbots can hold conversations to answer questions quickly.
• Personalized interactions that provide clients with recommendations or solutions are possible without having an employee do the work.
• Help is available to customers when they need it, even in the middle of the night.
• Interactions are seamless and consistent in terms of branding and customer care levels.
• Artificial intelligence insurance insights can help to provide recommendations and prompt for assistance, solving customer problems faster.
Use Cases of AI in Insurance
Consider some of the most effective ways AI is working in the insurance industry.
Intelligent Chatbots for Customer Service
AI-powered chatbots provide instant access to customer support needs, answering questions and assisting with policy information, claims, and other tasks. This helps reduce response times and improves overall customer engagement.
Automated Underwriting and Pricing
AI automates various components of the underwriting process, allowing for better assessment of risk and, then, better alignment of premiums. This can help to expedite underwriting decisions while at the same time ensuring pricing strategies and goals are in line.
Claims Automation and Processing
AI for insurance streamlines the claims handling process. This reduces the need for employees to handle various tasks. It can tackle tasks such as:
• Data extraction
• Documentation
• Validation
Personalized Policy Recommendations
AI algorithms analyze data to provide tailored policy recommendations to would-be clients. This uses all data about the consumer, along with preferences and available risk profiles, to create a personalized insurance policy.
Predictive Analytics for Customer Churn
Also notable is not just getting clients but keeping them. AI allows for predictive analytics that can determine what customer behaviors mean, which could provide early warning for potential churn. This allows companies to take action faster.
AI Application Benefits
Streamlined Claims Processing Faster, more accurate claims settlement
Improved Risk Assessment Enhanced decision-making for underwriting
Fraud Detection Advanced fraud prevention and detection
Enhanced Customer Experience Personalized service and engagement
Predictive Analytics for Customer Churn
Improved customer retention strategies
The Future of AI in Insurance
Where is AI headed? Here’s a look at what to expect.
Emergency Trends and Technologies
AI will help in the creation of new applications, especially as tools like deep learning and natural language processing come on board. This will allow for refinement in areas such as telematics and blockchain.
Data-Driven Decision Making
Data will become more robust and allow for more data-driven decisions. This not only takes the human emotional aspect out of the puzzle but it also enhances risk management strategies.
Ethical Considerations and Responsible AI
AI insurance industry use will continue to grow. One area of focus will be on fairness and accountability. Companies will need to ensure that AI implementation is done ethically and with a strong focus on customer privacy.
Impact on Employment in the Insurance Industry
AI will automate numerous tasks, changing the role of employees in the industry. That will create new jobs, but it will also enable people to make more of the complex decision making with more time and information to make those critical decisions.
Preparing for AI Implementation in Insurance
What can companies do now to see improvement over time? Evaluate AI Solutions and Vendors
Companies need to start looking at implementing AI technology and the vendors that offer it. This will include meeting their needs now but also as the company scales and grows.
Building a Comprehensive Data Strategy
AI implementation success is dependent on the data strategy used to define it. Companies need to identify data points and sources valuable to their operations and then meet all data governance and compliance requirements for using it.
AI is capable of empowering companies to make the best use of every minute of the day, allowing them to streamline most processes.
Training and Upskilling the Workforce
Employees need to learn new skills to work in this environment. It will be necessary to teach AI literacy as well as related skills to push out this technology effectively.
Addressing Regulatory and Legal Challenges
There is still a lot of work to be done in this area. Yet, companies will need to work to meet changing compliance rules over data protection and privacy.
Top Challenges in Adopting AI in Insurance
As the industry changes and bends to incorporate AI, there will be specific challenges that need to be overcome, including:
• Data quality and accessibility – is the data accurate and sourced from a reliable resource that’s accessible?
• Talent acquisition and upskilling – insurance teams will need to be skilled to use this method
• Legacy system integration – ensuring new solutions work with older models is also important
• Ethical and regulatory concerns – it’s likely these will change and flex over time, and it will be critical to stay up to date on them
• Customer acceptance and trust of AI-driven services – this could be the hardest factor to consider.
Find more agency tech guidance at Catalyit.com
Frequently Asked Questions (FAQ)
How does AI improve claims processing in the insurance industry?
It improves the claims process by minimizing the amount of work humans do, which speeds up the process of gathering and using complex amounts of data.
What are some examples of AI in underwriting and pricing?
AI in underwriting can source data and analyze risk in a matter of minutes. That allows for a more accurate underwriting process and better pricing strategies.
How can AI help in automating and expediting claims handling?
When claims come in, speed matters. With AI, it is possible to automate some of the challenges and data methods to ensure a more efficient and effective process.
What is the role of AI in personalizing policy recommendations?
AI can also help with personalizing policy recommendations because it allows for better analysis of data. This allows for a better forward-looking policy that meets the needs of clients more efficiently.
How does AI contribute to insurance fraud detection and prevention?
By spotting changes or anomalies in data or changes in claims, it’s possible to detect fraudulent actions faster.
What are the emerging trends and technologies in AI for insurance?
AI continues to emerge and change thanks to improvements in things like machine learning and natural language processing.
This article originally appeared on the Catalyit website at https://catalyit.com/artificial-intelligence-in-the-insuranceindustry/. Find more agency tech guidance at Catalyit.com.
Loss Scan, a Catalyit solution provider, is an AI-based software that automates the extraction of loss run data, overcoming the challenges of manual processing. Find out more at https://catalyit.com/loss-scan-joins-catalyit-solution-providerprogram/.
Could Your Agency Be Using ChatGPT and Other AI? Should It?
By Daniel Smith
Everybody seems to be talking about it. ChatGPT, Artificial Intelligence (AI), Generative AI, Large Language Models. You’ve probably heard some of these terms, and you may have even used some of this tech in your business or personal life. But what about for your insurance agency? Studies show that although around 80% of Americans are familiar with ChatGPT, less than 10% have utilized for a business use. So, can you? Should you?
Insurance Tasks
You have day-to-day processes that consume your time. Whether it be selling, service, administration, operations, are there ways AI could make your life easier? The answer may be yes, and let’s look at a few industry specific – InsurTech –examples:
Policy Comparison – Do you ever review policies to compare what your clients or prospects have now to a new policy option? There is now AI available to help you review and compare policies, even providing you with notes on their key differences. Check out Brightside AI if you’re interested.
Retention – We all know the stats on how it’s more profitable to retain current business than add new business. But how do you know which clients are likely to leave? One company has developed AI that can review your client data and find signals of who might be shopping their policy or considering leaving at renewal. This could help you target and be more proactive in keeping these clients. Check out ReFocus AI if you’re interested.
Quoting and App Entry – For years, agents have looked for a platform that would connect to all their carriers and streamline data entry. Many have tried, and some have gotten close. But what if it didn’t matter if your system connected directly? One company has developed a “super copy and paste” that let’s you take one entry from a portal or digital form, match fields to another, and paste the info into as many of these instances as needed. This could greatly reduce the time needed for quoting and may even help reduce human error. Check out Gaya AI if you’re interested.
Marketing Tasks
Okay, but what about all the “cool kid” stuff like ChatGPT, Jasper, Grammarly, Google’s Gemini (formerly Bard), and others? Marketing (promotion and advertising, not marketing accounts) is where these may come into play for your agency.
Let’s look at how:
Idea Generation – Wondering what blogs you could write, social media ideas you could post about, or content you could email to your clients? Ask AI! ChatGPT and Jasper are good examples of how you can “get creative” by using their technology. And while you do have to “prompt” them, it may be as simple as asking a question like, “What blogs topics could I write about for business insurance?”
Content Development – If you have content, but you want to improve it or change the tone, AI may also be able to help. Grammarly has rewrite options to help you make something sound more professional, more persuasive, less technical, etc. Even LinkedIn has a “rewrite with AI” tool on their posts now that can help you better fit their algorithm with keywords, tone, and hashtags.
Design – Not a graphic designer? There isn’t a lot of crossover between insurance skills and design skills. No worries, tools like Canva Magic Studio may be able to help build designs for you. Drafting content for a slide deck? Upload your brand and info to Canva, and it can help you build a presentation. Need an image for a social media post? Canva and other AI out there can help you build or modify one. Just check the hands if have AI build out images with people…
Concerns
This can all be helpful stuff and it may save you time, but what are the concerns? They mostly center around the technical aspects of insurance. If you have AI write a blog, compare a policy, enter policy info, or complete tasks for your agency, make sure that the human element is there to confirm it is correct. These AI tools are still learning – for example, the free version of ChatGPT uses data that is not yet current – and they may still be incorrect or not up-to-date on what could be important policy information.
No one wants additional E&O exposure for their agency. So, if you utilize these tools, use them wisely. Think of them as interns that are helping you research and develop, not as seasoned insurance professionals that can be left unmonitored.
Daniel Smith is Chief Marketing Officer and Co-Founder of Market Retrievers and also writes and collects content for Insight magazine. Find out more at marketretrievers.com.
This day-and-a-half conference, formerly known as EDGE, is powered by our Young Agents Committee, and is focused on bringing attendees some of the most relevant topics from engaging speakers. The interactive sessions are designed to empower attendees with exceptional sales skills and thoughtful leadership to drive sales success and achieve greatness.
ILLIN O I S 40 40 UNDER
Recognizing young, bright stars in the insurance industry.
Part 1
Derek Carroll
Devin Conkright
Mayra Cortez
Marco Espinoza
Danielle Finn
Derek Hayden Dylan Reetz
Luke Sandrock
Stephen Sedlack
40 UNDER 40
DEREK CARROLL
Clark Carroll Insurance Agency
Mt. Carroll, IL
Why did you choose to pursue a career in insurance?
Insurance was always a field I had eyeballed since I was young because my father was in the industry. After working in a different industry for six years I ultimately decided it was time to pursue the insurance industry. I entered the insurance industry for its blend of a flexible schedule and the opportunity to interact with diverse individuals.
What obstacles did you face when you first started, and how did you overcome them?
Having a father in the industry is great, but it also means when I first started in the industry my dad had already tapped into our network of family and friends for clients. To overcome this, I leveraged the internet, creating a website, engaging on social media, and starting a blog. These efforts helped me attract new customers beyond our immediate circle and expanding my client base. I also became active in the Chamber of Commerce, local youth baseball leagues, and other community clubs.
What’s something people should know about your generation in the workplace?
I believe most generations have more in common than they have different. In the workplace, it’s essential to recognize that despite generational differences, we all share desires for respect, recognition, and meaningful work. Understanding this similarity fosters collaboration, empathy, and a more inclusive environment where diverse perspectives can thrive, benefitting both individuals and organizations alike.
How has this industry impacted your life?
This industry has profoundly impacted my life. It has provided me with the opportunity to spend quality time with my children through a flexible work schedule while also enabling me to effectively assist people in managing their risks. It has opened doors to new relationships, enriching both my personal and professional spheres in ways I hadn’t imagined before.
Being one of the first calls when a friend considers starting a business and seeks insurance and business advice is truly awesome. These relationships and opportunities provide me with the most rewarding experiences and validate my decision to join the insurance industry.
DEVIN CONKRIGHT
Gully & Hechler Insurance
Barry, IL
Why did you choose to pursue a career in insurance?
Liked helping people and this gave me an opportunity to do so.
What obstacles did you face when you first started, and how did you overcome them?
Getting people in my Hometown to view me as a Business person and not the kid that grew up here. I was able to overcome this by providing Service to several customers and the word of mouth spread.
What’s something people should know about your generation in the workplace?
Despite what you might think we actually enjoy the work. We are versatile because we have worked and lived with and without technology.
How has this industry impacted your life?
It has allowed me to grow my family. I now have many customers that I would consider as family. I have been able to see many milestones in there lives and learn from them along the way.
DEREK HAYDEN
Shelbyville Insurance Services
Shelbyville, IL
Why did you choose to pursue a career in insurance? I had a good connection with our community and felt I could build a strong career by helping businesses and individuals in our area.
What obstacles did you face when you first started, and how did you overcome them?
I knew nothing about insurance or sales! I utilized the Big I resources to learn about insurance. I started working toward my CIC to get an in-depth understanding of how policy forms work.
I started learning how to leverage social media and video to bring in new business. I had to find something that helped me stand out from competitors and video was what helped me do that. Video proposals, podcasting, and social media are tools I still use today to bring value to my clients and stand out from the crowd.
MAYRA CORTEZ
Guy Viti Insurance Agency
Highwood, IL
Why did you choose to pursue a career in insurance?
I started in the insurance industry after college, and I found it offered a variety of rewarding aspects that involved many of my personal interests such as helping others, connecting one on one, and the opportunity to connect my career interest with passion of helping others. Especially the Spanish speaking community.
What obstacles did you face when you first started, and how did you overcome them?
My first obstacle was asking current clients for referrals and attending networking events. Some of our best customers will come from our referrals, however I found it a bit intimidating to ask. With time, and an email template that I follow, it became easier to ask and mention during a call or an email. Networking is something I am still working on, however I attend as many as possible and have a standard limit of connecting with at least 5 people at each event. This helps ease the process and feels less overwhelming.
What’s something people should know about your generation in the workplace?
I am part of the Millennial generation, and we are known to be hard working people who were part of both sides of the internet growth. I enjoy the research online as well as on a book, which demonstrates our flexibility and motivation to get things done. We are fun and energetic people who are looking to grow and develop.
How has this industry impacted your life?
I have learned so much from basic insurance knowledge that we should all know, to larger coverages that I didn’t even think about or knew it existed. I have thanks to this career opportunity, taught family and friends about insurance and it’s importance. Sharing my knowledge and expertise with others is a satisfaction, I did not think I would feel. Lastly, it has helped me grow as an individual and it has allowed me to meet people from various backgrounds and industries, travel and connect with other young agents who have similar experience as I do.
What’s something people should know about your generation in the workplace?
My generation is very passionate about helping people, we just do it in a different way. Many younger insurance professionals are very efficient with technology and are able to maximize their performance with unique tools and strategies.
How has this industry impacted your life?
The insurance industry has allowed me to build a career that I never could have imagined. Insurance has afforded me the opportunity to work with so many awesome people and businesses. Being a sales producer also allows me to utilize my creativity to grow our agency and support our clients.
40 UNDER 40
MARCO ESPINOZA
Pronto Insurance Services
Schaumburg, IL
Why did you choose to pursue a career in insurance?
I graduated from college with a bachelor’s degree in communications, aspiring to become a journalist or news TV anchor. When I entered the insurance industry, it was initially just a job opportunity while I searched for a career-related position. However, after obtaining my property and casualty license and assisting customers with their insurance needs, I discovered a passion for the work. I found myself receiving referrals from numerous clients, including family members, friends, and coworkers. This made me realize the significant need for assistance within the Hispanic and high-risk driver communities.
What obstacles did you face when you first started, and how did you overcome them?
When I started, I had no prior knowledge of insurance. I began working for a nonstandard carrier that insured high-risk customers. Understanding the underwriting guidelines was challenging. I was tasked with insuring customers classified as ‘high risk,’ and I needed to ensure that I followed every underwriting procedure for every policy I wrote. Dealing with ‘high risk’ drivers was particularly challenging. This is a market that many insurance carriers and agencies do not want to accept. So, I found myself in a challenging position where my ethics and professional morals guided me to continue educating myself and seek resources to assist all these highrisk drivers who were often left behind due to their driving records. Additionally, I faced the challenge of working with non-English speaking customers, requiring me to develop translation skills.
While Spanish is my first language and communicating with Spanish-speaking customers was easy, translating from Spanish to English posed a significant challenge.
DYLAN REETZ
EDGE Insurance
Buckley, IL
Why did you choose to pursue a career in insurance?
While I was working in agricultural and commercial lending, I was approached about beginning an insurance career. Knowing how much risk my clients at the bank faced, I thought it would be an interesting and rewarding career to pursue. Having an interest in commodity futures and grain marketing, intertwining a risk management plan for farmers was an intriguing idea.
However, through practice, perseverance, and a commitment to personal growth, I overcame this challenge and continued to evolve as new challenges arose.
What’s something people should know about your generation in the workplace?
People should be aware that we are currently facing significant challenges in the industry. However, despite the challenges, the industry continues to maintain its stability and it still offers numerous opportunities for professional growth, helping others, and building a career. There are specific areas within the industry where we need the new generation to engage and pursue careers, such as underwriting, claims adjuster, and new insurance producers etc. As the industry evolves, especially with advancements in technology, we need to adapt to these changes. Embracing new generations and encouraging them to pursue careers in the industry is vital for its continued growth and resilience, particularly in today’s challenging market environment.
How has this industry impacted your life?
After finishing college, I found myself in debt and struggling to pay bills. Losing my parents at a young age taught me to find a way to survive. Fortunately, the insurance industry offered me a job and a career that I am proud of. Working with an independent agency like Pronto Insurance Services has provided me with the opportunity to collaborate with multiple insurance carriers, develop professional skills, build a well-prepared team, and continuously evolve to adapt to the industry’s ongoing changes. I take pride in the career path I’ve chosen and the opportunities it has afforded me, and I am excited to continue growing in the industry.
What obstacles did you face when you first started, and how did you overcome them?
The biggest challenge at first is becoming comfortable and fully understanding the products you are offering to your clientele. When you are working with older clients, proving your knowledge makes them more comfortable working with a wide age gap.
What’s something people should know about your generation in the workplace?
Our generation can adapt quickly to change. With everchanging technology and software, we are not afraid to try something new if it makes sense for the workplace and ultimately benefits our clients. We often find the most efficient way to get great results in the workplace.
How has this industry impacted your life?
Being a young agent has been challenging but ultimately rewarding. There is a lot of opportunity to do well in this industry. It all comes down to hard work, strong customer service, consistent self-education and trying to help others. Working in a rural area and with a lot of family farms, I enjoy helping them manage their risk in order to have a successful crop year. I am really looking forward to being involved in this industry for the coming decades and to keep growing our one-location, independent agency in Buckley.
DANIELLE FINN
Loman-Ray Insurance Group
Sullivan, IL
Why did you choose to pursue a career in insurance?
Insurance has always been part of my life. I grew up watching my mom build an agency in our hometown. I remember riding around with her back then snapping polaroid pictures of a new “risk she was writing.’ I remember as a child I did not understand why she was writing about all these random buildings. In high school I was the person keying every paper document into our new agency management system, TAM. Then later I rejoined the agency helping with marketing and bookkeeping because it fit my schedule as a mom of three young kids. A few years later I decided to make the leap to the sales side and have enjoyed it since. This career has so much opportunity for growth and professional development.
What obstacles did you face when you first started, and how did you overcome them?
When I transitioned to sales, I was predominantly active on the health side. The biggest obstacle then was lack of knowledge. I was lucky enough to get paired with a more seasoned agent as a mentor, Rick. I learned a wealth of knowledge as I worked alongside him on health policies. Even today I still will lean on him if I hit a obstacle I can’t pass on my own. When it comes to P/C side I feel like knowledge was again the biggest obstacle at first. The one statement that I can still hear every time I hit one is “just pick up the phone and call the underwriter.” This was advice I often heard and at first didn’t like it. I wanted answers now but with each discussion with the underwriter I learned a little more about their appetite and the ins and outs of their company. This helped me prospect risk that I had a good fit for and be more economical in placing them.
What’s something people should know about your generation in the workplace?
I am included in the Millennial generation, the one that used to cause the biggest eye roll when mentioned until Gen Z came along. In the workplace we can adapt well and are flexible. Don’t mistake our confidence for arrogance, we are motivated to find creative solutions and can seem overbearing when doing so. Our generation is more tuned in to sensitive social issues than older generations. Of course, our most well-known trait in the workplace, we can be IT when needed. Seeing as we grew up with the beginning of internet and computers becoming common and phones making information accessible everywhere.
LUKE SANDROCK
The Cornerstone Agency Tampico, IL
Why did you choose to pursue a career in insurance? There were just so many cool acronyms... I wanted to be on the inside and know what they meant.
What obstacles did you face when you first started, and how did you overcome them?
I think the hardest thing was not knowing answers to questions. Asking/looking for answers was the only way to solve that... and still holds true even years later.
What’s something people should know about your generation in the workplace?
Not sure I’m qualified to speak for an entire generation? I will say personally, although technology plays a huge role in efficiency, I much prefer face to face interactions.
How has this industry impacted your life?
Whether it’s clients or industry peers, I’ve been fortunate to build relationships with some tremendous people.
How has this industry impacted your life?
This industry has impacted my ability to enjoy life outside of the office. It has helped me gain financial freedom to support my kids’ hopes and dreams one sport at a time. Ensuring I have time to be present as they grow up whether it be a school field trip or camping in a tent at scout camp. The flexible schedule along with the ability to grow a book directly tied to the work you put in is pivotal to enjoying your life now, not years down the road.
Another impact is the people I have encountered and some that are now close friends. I suggest all new agents attend seminars and conventions. You will become part of a community within this industry which is priceless. Doing so enables you to learn and grow off others’ experience. Even if it’s just not to feel alone and stuck in this rough market we are currently seeing. Go take part and be active, it will help you thrive.
40 UNDER 40
STEPHEN SEDLAK
Schmale Insurance Agency
Belleville, IL
Why did you choose to pursue a career in insurance?
I chose this career because I had gotten my feet wet in a outside sales role at ADP and loved what I did but hated the fact that I started at 0 every year. I loved the fact that in this industry I could not only assist business and clients with their needs but also be able to build a book of business and build on it every year. It truly has been a win/ win.
What obstacles did you face when you first started, and how did you overcome them?
How to differentiate myself. I was new to this industry and knew just enough to be dangerous. I had the B2B background so getting my foot in the door with prospects was never an issue, but finding that “it” factor that helped me sell beyond price and coverage gaps was hard to find at first. I started to focus on work comp and working with the Institute of Work Comp Professionals and their teachings of how to help companies manage their work comp program instead of just quoting it was a game changer. I quickly wrote a book about work comp called “The Work Comp Control Effect” and it became a number one best seller on Amazon. But I actually use that book more in prospecting and use it as a giveaway at seminars or send to a prospect who has a high mod , etc. Its really been quite the game changer for me.
What’s something people should know about your generation in the workplace?
We’re adaptive. We can work in most situations and circumstances. We aren’t set in certain way and are always looking at methods and ideas that could transform how things are done for the better, but always understand the importance of “the old way”
How has this industry impacted your life?
Tremendously. I have met some amazing people along this journey from coworkers to other agents to clients. This industry has taken me to some great places and meet new people on a daily basis. There is a since of pride when I inform people what I do and WHY I do it!
Look for the next group in the March issue of Insight!
Small Business Insurance
We’ve been successfully protecting small businesses since 1983.
DEVELOPING NEW PRODUCERS Through Retention and Cross-Selling
If you have new producers at your agency, you may be looking for ways to get them started that don’t just include cold calling. One option could be having them help identify opportunities for increased retention and insureds that could be cross-sold on other coverages.
Senior producers at your agency likely have a full slate of tasks that occupy their time. Newer producers may be able to work with them on these cross-selling and retention projects, possibly earning a commission split or even taking some of the workload off of others. Here are some approaches and benefits to consider:
• Identify potential non-renewers
• Young producers can work to find trends in your book on those that don’t renew
• They can then help develop a plan for outreach and coverage options
• Help cultivate cross-selling opportunities
• Young producers can study your data and compile insureds that don’t have multiple lines of business with you or may need additional coverage
By Colby Tunick
• They can then determine those with the most upside and/or the likeliest needs
• And again here, they can help develop a plan for outreach and coverage options
• These activities can combine to lead to higher client satisfaction, a better client experience, and more retention
• These activities can also grow the knowledge of the young producers as they learn more about coverage needs, risks, and opportunities to sell
• And finally, these activities can develop more collaboration within your team and may even improve job satisfaction and retention of your employees
And if these new producers need help identifying retention trends, ReFocus AI can help provide a solution. Let us show you how we can do just that with automated reviews of your policyholder data. It’s a great first step to developing your new producers!
This article originally appeared on the Refocus AI blog at https://www.blog.refocusai.com/developing-new-producersthrough-retention-and-cross-selling/.
Mile Markers A 3-Year Plan to Validate a New Producer
By AnneMarie McPherson Spears
As seasoned producers reach retirement age, investment in new ones is crucial for agencies that are looking to grow. A strategic model for helping new producers validate, which is when an agent’s production as measured by commission is equal to the cost of paying them, is a key way agencies can ensure that investment pays off.
How long should it take for a producer to validate? As with all things insurance, it depends.
“Not only does it depend on the compensation model, it also depends on the investment in the producer - and compensation’s only one investment,” says Susan Toussaint, vice president, ReSource Pro. “If we’re talking about a brandnew producer who is new to the industry and new to selling, it’ll probably take a full three years if the agency is investing in a curriculum of training that builds business acumen, insurance and technical acumen, and selling skills.”
Here’s a template schedule that Toussaint recommends for a three-year plan to validate new producers:
Month 1: Understand systems. “If you want people to put their pipeline in a customer relationship manager (CRM), teach them how to use it now,” Toussaint says. “I can’t tell you how many people I’ve worked with that have been in an agency for years and tell me, ‘I don’t know how to use the CRM, so I’m still keeping everything in a Word document.”
All producers should be trained on all systems—the agency management system and any sales tools - and have them mastered early.
Months 1-3: Understand departments and the agency. Alongside getting up to speed on systems, this step is particularly important if the producer is new to the industry. “Have them spend time with their account managers and with folks that handle claims,” Toussaint says.
It’s also important to have the new producer meet producers in different lines. “For instance, if they’re property & casualty, have them spend time with an employee benefits producer to better understand what cross-selling questions to ask,” she explains.
Months 4-5: Develop a top 100 list. The list of prospects “should be very clear on who they’re going to target so they can begin to intentionally grow their book of business,” Toussaint says. “It’s going to help them better understand how that agency is best suited to work with those types of risks as well.”
Months 6-12: Execute on the list. The new producer should start “making phone calls, doing drop-ins, sending information and doing research,” she says. By the one-year mark, they “should be able to competently execute a sales process.”
Thanks to a chosen specialization, the new producer should reach the point “where you could ask them at a sales meeting to teach back a topic that aligns with the industry they’re focusing on,” Toussaint says. “They should have built enough at-bats and done enough research to be comfortable talking about certain risks in their specialization.”
Months 13-24: Build a second niche. While it may be unrealistic for a new producer to only focus on business in their niches, “it should mean they are intentional about driving business to the agency in their particular niches,” Toussaint says. “Maybe in year one, they’re focused on construction. In year two, they decide they also want to specialize in manufacturing. So now they’re working on building the technical acumen that supports a manufacturing book of business, building a pipeline that supports both construction and manufacturing, and further narrowing down into those two niches.”
Months 25-36: Follow their business plan. “They should be off to the races in year three,” Toussaint says. A good way to solidify a producer’s training is to offer them opportunities to show even newer producers the ropes. “They should be able to show someone else how to do the job completely,” she says. “They should have enough repetitive experience in doing a submission, cold calling, using the CRM.”
At this point in the journey, “they should be clear about who they want to be, and use their business plan to get there,” she says.
This article originally appeared in IA magazine - iamagazine. com/strategies/mile-markers-a-3-year-plan-to-validate-a-newproducer.
AnneMarie McPherson Spears is IA news editor.
We’re Not In Kansas Anymore
At no other time in the history of insurance has the marketplace for new and existing policies been more challenging. If you think you know what markets are available and feel you know what appetite carriers have for new business, just wait a week, and all could be, and often is, changed. While agents and agencies are frustrated and overwhelmed attempting to adapt to these frequent and often confusing changes, consumers are completely at a loss to understand changes to coverage, deductibles, and seemingly unwarranted increases in premiums. As the face of the industry, agents often become the direct target of consumer’s contempt for an already unpopular part of their budget.
As all of us, agents and consumers alike, begin to accept that the world of insurance is changing and will likely never return to the days of lower deductibles, lower premiums, and consumer-driven insurance sales, the real concern in my estimation is the hidden dangers of Errors and Omissions claims against agencies.
Insurance agents across the country are finding that the normal course of business today involves moving client’s policies from one program to another, from one insurance company to another, or capturing new clients from other insurance providers as clients seeks better pricing. Each time changes to policies or changes in insurance companies are made, subtle, and not-too subtle, differences between policies/companies change the scope of coverage and create potential shortfalls in important risk transfer for policyholders. It’s impossible for even the best agencies to have the time and resources to go through the nuances of every policy in an effort to properly advise policyholders where a replacement policy might have less coverage or has shifted costs to the consumer. Decisions made by agencies about which coverages they will highlight and which they will let the client discover on their own create real and present dangers for agencies. Clients that are “surprised” by unpaid claims, quite often feel the remedy is in the court system.
Recent E&O claims brought by disgruntled policyholders against insurance agencies highlight unprecedented consumer grievances about even the smallest changes to coverage. Customers have unwarranted expectations that their agents will have fully explained the inner workings of all aspects of policy coverage. While courts often recognize the policyholder’s responsibility to read their own policies, juries and courts time and again feel sympathetic to plaintiffs suffering the financial burden of uncovered or inadequately insured claims.
On the other hand, agents attempting to retain valuable clients and meet the client’s expectations of affordable coverage, many times find it necessary to use insurance products offered by unfamiliar carriers and rarely-used markets. In personal lines the trend
By Todd Davis
is moving towards policies with restrictive roof provisions and limitations on insured perils. In commercial lines many agents turned to the Excess and Surplus Lines market to find carriers willing to write risks. Being unfamiliar with the terms, exclusions, warranties, and conditions in E&S policies is a recipe for disaster. Agents taking shortcuts in assessing new and renewal business, making assumptions about the nature of the clients’ exposures, and focusing more on premium than coverage, contribute significantly to the rise in E&O claims.
As it has always been, agencies should continue to focus on the 3-prong approach to reduce exposures to E&O claims. There is no substitute for the basics. Documentation, Communication, and Consistency. I would add one more key element. Knowledge. An agency must know the specifics of the policies they sell, must properly and consistently communicate those details to policyholders, and must document those interactions with all customers. When a claim arises for a policyholder the best defense an agency has against allegations of negligence is having clearly memorialized conversations and communications with policyholders about which risks they have retained and which risks they have transferred to an insurance company. Agents should treat every interaction with policyholders as if those communications, be it phone conversations, emails, text messages, or old-fashioned snail mail, could be examined in a courtroom. Would a jury look at those exchanges between an insurance professional and the consumer and find that the agent had done all that is reasonable to advise and inform the customer.
It’s true. We’re not in Kansas anymore. However, we’re not in OZ either. The road we’re on is certainly not the yellow brick road.
Todd Davis has over 25 years experience teaching professional continuing education classes and more than 40 years working in the industry as an agent, agency owner, and expert witness.
Farm Agents Council
a division of the Independent Insurance Agents of Illinois
Mid-Winter Meeting Wrap-Up
The Farm Agents Council (FAC) hosted the 94th Annual MidWinter Meeting on February 1-2, returning to the Embassy Suites in East Peoria, and brought together over 160 people for the event.
The FAC Board puts together two great days of education, networking, collaboration, food, drinks, a tradeshow, and, of course, fun. Attendees had the opportunity to earn six hours of Illinois continuing education specific to this network, including a special presentation on the Hard Market and the recent Farm Mutual legislation. The Big I Illinois team, Phil Lackman, Evan Manning & Brett Gerger, were joined by Jackie Rakers, IAMIC, and Jennifer Hammer, JW Hammer, LLC, who shared insights behind the legislation and the work it took on getting it successfully passed during an emergency veto session last fall.
One of the group’s favorite presenters, Chris Barron, returned on Friday morning to share insights on Managing Risks While Planning for Profits in 2024. His three-part session walked attendees through lessons he learned, strategies he developed, and ideas for how to grow your crop insurance agency. His deep-dive interactive sessions are always a group favorite. One attendee even stated they are still using the tools he shared at his last presentation in 2022.
By Shannon Churchill
During the Mid-Winter meeting, the Farm Agents Council gave two significant awards. First, Luke Sandrock of Cornerstone Agency in Morrison, IL, was presented as the recipient of the 2024 Randy Jacobs Service Award for Community Involvement. Luke was recognized for his outstanding volunteerism and commitment to the community and insurance industry. He went above and beyond this year, working to pass legislation to prevent a negative impact on many of our partners and to preserve coverage for many consumers. He is always there to answer the call for help.
The FAC Board also recognized Evan Manning with their Distinguished Service award for his outstanding work on passing the Farm Mutual legislation. This critical piece of legislation saved a large segment of our population and helped many customers and clients maintain their insurance coverage. We know the blood, sweat, and tears Evan and everyone involved put into passing this, and we appreciate all you did!
Thank you to everyone who participated in the event! We look forward to seeing you later this Summer. If you want to get involved with the FAC or learn more about our organization, email farmagents@ilbigi.org. If you are in the crop/ag/farm industry, mark your calendar for our upcoming events and consider joining the Farm Agents Council.
Luke Sandrock, recipient of the 2024 Randy Jacobs Service Award for Community Involvement, with Amy Jacobs
Evan Manning, right, recipient of the Distinquished Service Award, with Steve Foster, left, and Luke Sandrock
a library of free, professionally developed marketing materials you can use at your agency. All items will be delivered customized with your agency’s logo and contact information.
In Memoriam
Roy E. Robinson, 96, of Springfield died on February 1, 2024 at Lewis Memorial Christian Village.
He was born in Plattsburg, NY on March 8, 1927, the son of Irvin and Mildred Robinson. He married Harriet F. True in 1951 in Syracuse, NY.
Roy attended Champlain Central High School and graduated from Syracuse University in 1950. Roy received his CPCU designation (Chartered Property and Casualty Underwriter) in 1960 and his CAE (Certified Association Executive) in 1975. He was a member of Sigma Pi Fraternity at Syracuse University and a US Navy veteran in World War II serving on the USS Wisconsin battleship. He was honored to attend the September 2011 Land of Lincoln Honor Flight to Washington, D.C.
Roy worked as a Special Agent for Transamerica Insurance Company for several years in Syracuse, NY and was the Executive Director of the Independent Insurance Agents of Illinois (now Big I Illinois) for 20 years. He retired in 1990. He was Past President of CPCU Chapters in Syracuse, NY and Bloomington, IL; Past President of ISAE (Illinois Society of Association Executives) and Past President of national IAAE (Independent Agents Association Executives).
Arachas Group: February Rough Notes Agency of the Month
Big I Illinois Chairman of the Board, Kevin Lesch, and his team at Arachas Group were featured on the cover of Rough Notes magazine in February! Arachas Group, Rough Notes Agency of the Month, is located in Bartlett and offers insurance solutions in 44 states.
In 1975, Michael Sullivan formed Sullivan & Associates, which quickly grew roots in Bartlett, Illinois, offering insurance solutions to the local community and the surrounding area. Being part of the Chicago metropolitan market, Bartlett offered plenty of opportunities. So it was not surprising that another independent agency, Bartlett Insurance Group, opened its doors there in 1986.
The two family agencies remained friendly competitors for decades, both thriving over the years as they carved out specific insurance and risk management industry focuses.
Then in 2017, they merged and created Árachas Group, bringing together some of the finest industry professionals from both agencies. These included William Sullivan, son of the Sullivan & Associates founder, and Kevin Lesch from Bartlett Insurance Group, a member of the family that founded that agency; they were joined by other industry leaders Dallas Peters and Brian Dolewski, from Critchell Miller, when Árachas purchased half of that agency later that same year.
Read the feature article at http://tinyurl.com/RoughNotes-Arachas.
Roy was a member of the First United Methodist ChurchWest-Springfield, the IBT Sunday School Class, the Chapel Church at Mesa Spirit, AZ, the Chatham Masonic Lodge #523-32th degree Scottish Retired Mason, the Ansar Shrine Parade Group, the Ansar Patrol and Ansar retiree Club.
Roy and Harriet lived in Chatham, IL for thirty years. During retirement they spent 23 winters in Mesa, AZ. Roy enjoyed playing golf and watching all sports, specifically his beloved Chicago Cubs. He enjoyed playing cards, traveling, and spending time with his growing family.
Roy is survived by his wife, Harriet of 72 years; 3 sons: Bruce (Delaine) of Wheaton, IL, Gary (Maria) of Springfield, IL and Roy Jr. (Jill) of Las Vegas, NV. There are 6 beloved grandchildren and 6 adorable great grandchildren with two more on the way.
Thank you to our Associate Members.
Diamond Level
Platinum Level
Progressive Surplus Line Association of Illinois
Silver Level
Gold Level
Arlington/Roe
Blue Cross/Blue Shield of IL
Pekin Insurance
A. J. Wayne & Associates
AAA, The Auto Club Group
AMERISAFE
AmTrust Insurance
Amwins
Auto-Owners Insurance Co.
Berkley Aspire
Berkley Management Protection
Berkley Small Business Solutions
BriteCo Jewelry & Watch Insurance
Central Illinois Mutual Insurance Company
Chubb
Columbia Insurance Group
Cornerstone National Insurance Company
Cowbell Cyber
Donald Gaddis Company, Inc.
Donegal Insurance Group
EMC Insurance
Encova Insurance
Erie Insurance Group
Foremost Choice Property & Casualty
Forreston Mutual Insurance Company
Frankenmuth Insurance
Grinnell Mutual Reinsurance Company
IA Valuations
Illinois Mine Subsidence Ins Fund
Illinois Public Risk Fund
Independent Mutual Fire Insurance Company
Keystone Insurance Group, Inc. SECURA Insurance
Berkshire Hathaway GUARD Insurance Companies
Bronze Level IMT Insurance
Indiana Farmers Insurance
Insurance Program Managers Group (IPMG)
J M Wilson
Liberty Mutual/Safeco Insurance
Madison Mutual Insurance Company
Main Street America Insurance
Maximum Independent Brokerage, LLC
Mercury Insurance Group
Method Workers Comp
Midwest Insurance Company
Nationwide
NHRMA Mutual Workers’ Compensation
Pinnacle Minds, Inc.
Previsor Insurance & Missouri Employers Mutual
Rhodian Group
Rockford Mutual Ins. Co.
ServiceMaster DSI
Society Insurance
SPRISKA - Specialty Risk of America
Steadily
Summit, A Member of the Great American Insurance Group
Travelers
UFG Insurance
Universal Property & Casualty
W. A. Schickedanz Agency, Inc./Interstate Risk Placement
West Bend Insurance Company
Western National Insurance
Westfield
Pekin Insurance Implements Guidewire Cloud
for Expense Management and Improved Platform Support
Pekin Insurance, an Illinois-based multi-state property and casualty (P&C) insurer, and Guidewire (NYSE: GWRE) announced that Pekin Insurance has successfully implemented Guidewire InsuranceSuite on Guidewire Cloud to power its core business, simplify its IT operations, adapt quickly to changing market demands, and deliver more value to its agents and policyholders.
A Guidewire customer since 2015, the company migrated InsuranceSuite from a self-managed environment to Guidewire Cloud simultaneously for all its lines of business in the states where Pekin Insurance operates. The company is also using the Guidewire ProducerEngage digital application and Guidewire Predict to improve its loss ratio with better risk segmentation.
“We chose to migrate our Guidewire products onto Guidewire Cloud to better optimize our costs and improve platform support,” said Pekin Insurance Chief Information Officer and Vice President Amy Bingham. “We’ve now transferred platform maintenance to Guidewire so we can utilize regular ongoing updates and take advantage of Guidewire’s latest innovations much more quickly and seamlessly than when we were using Guidewire on premise.”
Pekin Insurance Assistant Vice President of Information Technology Kim Bandeko added, “We’ve received positive feedback from our agents, specifically around the user interface which is visually appealing. We’re looking forward to increased external rating and underwriting agility, leveraging the data and analytics products that are available on Guidewire Cloud, and integrating with the best-in-class Insurtech solutions through the Guidewire Marketplace and PartnerConnect ecosystem across our insurance product lifecycles.”
“Pekin Insurance has a 103-year history of offering financial protection for businesses, personal autos, homes, and families through their P&C and life insurance products,” said Michael Mahoney, senior vice president and head of professional services, Guidewire. “We congratulate the company on its successful cloud transformation through its InsuranceSuite migration to Guidewire Cloud. We look forward to Guidewire Cloud serving as the technology foundation to support Pekin Insurance’s mission of providing peace of mind to its agents and policyholders, delivering innovation and excellence in its products and services, and remaining dedicated to going Beyond the expected®.”
SECURA Insurance Publishes 2023 Annual Report
SECURA Insurance published its 2023 annual report sharing details about the company’s financial results, corporate projects, and company culture. In 2023, SECURA grew direct written premium to $1.1 billion and its agency partners produced $141 million in new business.
In addition to financial growth, SECURA offered more than 17,500 hours of continuing education credits to its agency partners through in-person courses, webinars, and on-demand videos. The company also offered performance development opportunities to its associates, with 291 exams taken through The Institutes Knowledge Group and 42 associates completing the company’s Foundational Leadership Program.
To view the full 2023 annual report, visit secura.net/annualreport.
ILLINOIS
Celebrating Tom Ross
On February 9, Big I Illinois staff, members, family, and friends gathered together to celebrate Tom Ross and his retirement from his full-time position as Director of Membership.
Though Tom is continuing in a part-time role with the association as the Northern Illinois marketing representative, we were happy to celebrate his contributions not only to the association but to the insurance industry as a whole. Tom started as an agent in his father’s agency, and through the years, volunteered on the Big I Illinois Board of Directors and Committees. He joined the staff in 2015 after selling his agency and has been a unique asset to the team since that time.
Local Legislative Events
Local legislative events were held on January 26 in Vernon Hills and Wheaton. Several staff members attended and provided information about issues facing the insurance and financial industry.
Several legislators were also in attendance: Rep. Jeff Keicher, Rep. Bradley Fritts, Rep. Harry Benton, Rep. Jenn Ladisch Douglas, Rep. Dan Ugaste, Rep. Amy Grant, Sen. Seth Lewis, and Rep. Marty McClaughlin.
House Insurance Committee Meeting
Evan Manning, Big I Illinois Director of Government Relations, took part in a House Insurance Committee meeting in Chicago on House Bills 4611 and 4767, which would impose Rate Regulation and Underwriting restrictions on all insurers in the automobile market.
For
Big I Illinois membership or company sponsorship, contact Lori Mahorney, Director of Membership Services, at (217) 321-3008, lmahorney@ilbigi.org.
INDEPENDENT INSURANCE AGENCIES WANTED
17. We are an Independent family-owned agency located in the Chicago area. We are looking to expand through growth and acquisition. If you have a small to medium sized agency and are looking to sell, call or send us a message. We are strictly looking for Personal Lines and Small Commercial accounts with preferred companies.
GALO Insurance Agency, Inc (847) 832-0888 steve@galoagency.com
AGENCY WANTED
20. Since 2004, Central Illinois Agents Group LLC has been providing independent agents with a variety of markets with contingency opportunities. Agents have availability to several markets that they may not be able to sustain or maintain on their own. We have markets for personal, commercial, agricultural and crop insurance lines. Let us help you get to the next level.
Visit www.ciagonline.com for contact information.
LOOKING FOR AN EXIT STRATEGY?
23. Are you looking for an exit strategy while still continuing to produce for a few years or are you ready to sell now? Paczolt Insurance would like to talk with you! We are an independent agency dating back to the 1970s that is located in the western suburbs. Our focus is on mid-to-small commercial accounts and personal lines. Our companies include EMC, Badger Mutual, Safeco, Progressive, and Travelers. We have the flexibility and capital to get a deal done. Contact:
Susan Troppito Paczolt Insurance susan@piaigroup.com (708) 215-5202
AGENCY/AGENTS/PRODUCERS WANTED
02. Forest Park/Oak Park agency for over 60 years, will meet your needs by providing space, markets, marketing & sales support, automation, merging with or purchasing your agency. Perpetuation/ Succession Plans, Buy-Sell Agreements also available. We have experienced, educated and dedicated staff for you and your clients. Have access to our numerous companies, office services and many other resources. Retain ownership in your book with contingency. Please look closely at us- we are an agency you want to do business with! We’ve done it before, we know howwe make it easy! Visit our website at forestagency.com/ agents.html, or call for a confidential discussion and a list of Agency benefits.
Dan Browne will provide an agency evaluation/ appraisal at little cost to you. Please call:
Dan Browne or Cathy Hall Forest Insurance (708) 383-9000 www.forestinsured.com/mergers-acquisitions
OPPORTUNITIES/SPACE AVAILABLE/ RETAIN OWNERSHIP
13. We are a 100 year old Northbrook agency looking to discuss any mutually beneficial opportunity. Our producers, mergers, clusters and agency purchases receive 50% commissions on new and renewal business without any expenses. We can provide: office space, phones, agency management system, service renewals and changes. The companies we represent are: Badger Mutual, Employers Mutual, General Casualty, Guide One, Hartford, Kemper, Progressive, Rockford Mutual, Safeco, State Auto, Travelers and Met Life. Contact:
