This checklist is sponsored by
So, the time has come to consider whether or not your agency should hire more staff or whether “outsourcing” some component of the customer service transaction or back office processing would be a better alternative.
Whether called “outsourcing”, “virtualizing,” or some other catchy term, the first step any agent should take is to identify and review the various factors that are prompting you to consider this alternative for your agency.
For example, have you made, or thought about, any of the following types of statements recently?
- “I need to increase the policy count per client, but my staff is not asking for these opportunities”
- “I must refocus my in-office staff toward account & coverage reviews so we increase our retention”
- “My staff is only reactive – they must have more proactive client contact & capitalize on opportunities to be visible at community & networking events”
- “I want to re-orient my staff toward risk management & consulting services.”
- “I have a new program that I will launch soon, and want to tap into my in-house expertise, but they are so busy servicing existing clients.”
- “I simply must find a different way to manage the growth that is happening.”
- “When employees are on vacation or out of the office, it creates a burden on everyone else, affecting morale in the long term – but, everyone deserves their vacation time!”
“And most importantly, how, if managed well, will implementing an outsourcing solution positively affect your bottom line?”
The truth is, if you aren’t accomplishing your goals for retention, growth and bottom line profitability, chances are it is time to think of some new strategies to do so. One easy-to-implement solution can be to outsource customer service calls, emails and other routine service transactions, whether in the front end or back end of the office.
If potential payroll/benefit savings is your sole reason for considering outsourcing, the time and effort alone for the set-up and ongoing communication with the vendor are critical to success. It is important to remember that allowing you and your agency to thrive in a challenging hiring environment in order to positively impact your bottom line are better metrics than cost savings alone.
To help evaluate vendors and ensure the success of your relationship with a provider, VIP has devised the following checklist to help agents during their due diligence process:
Be clear on the breadth of services being offered by an outsourcing firm
Make certain you ask about what types of transactions are included in the contract and be sure that you understand how they synchronize with your exact needs. Don’t assume that “processing” or “customer service” means the same thing to you and a vendor.
Ensure that there will be standard workflows that the vendor will follow
Be prepared to share your workflows and, if you have none, ask for a walk-through of examples of the vendor’s workflows/documentation standards. If you have specific customization needs, make sure to state these upfront.
Make sure to have the appropriate technology in place before outsourcing
Ideally, an agency’s phone, IT, servers and agency management systems should support remote access as well as ease of call transfer and identify the additional cost of every element required.
Evaluate whether or not the “Virtual Staff” will be a cultural fit with my agency and staff
Perhaps the hardest of all to quantify, you should be prepared to share your agency’s values, standards for customer care and any cultural identifiers. Be honest! Ask to speak with one of the vendor’s customer service team members and confirm with the vendor that servicing personnel have insurance service experience, adequate training and expertise on your agency management system, carriers, portals and technology. Listen to the tone of voice with everyone you interact with and communicate your service commitment expectations upfront. Inquire about licensing for personnel who will be servicing your agency. If it isn’t a fit…re-think your position.
Will my In-House Staff be on-board with outsourcing?
Another critical step an agency owner must take is to ensure that their in-house agency staff will be supportive of this transition. This is a philosophical and a logistical move that your team members must embrace. How to accomplish this? Create a team to be involved in the Q&A process, develop a list of “what we want to accomplish” and enable and maintain effective communication, during and after the decision is made to outsource. Address concerns upfront, and clearly communicate that support and camaraderie will be expected.
Don’t forget to ask for and check a company’s references and to verify how long they have been doing business with each vendor –
Develop a list of questions that relate to your specific concerns, such as: What types of issues they encountered during the implementation phase, how did they accomplish getting internal staff to support the transition to outsourcing; their strategy for achieving ongoing communication and how responsive was the vendor when a problem occurred or a change needed to be made to a process? Benefit from the experiences of agents who have been through onboarding.
What do I need to do to prepare for the onboarding?
Certify that the vendor has a well-established on-boarding process, establishes an estimated time frame to “go live” and has a procedure for testing all software connections prior to initial launch.
What about the security of client data as well as my agency?
Obtain a copy of the firms’ WISP (Written Information Security Policy) and review it thoroughly. Are their standards in line with best practices for virus protection, spam filters, and information security? Ask for their Nondisclosure Agreement (NDA) for your review and completion prior to you sharing any “client screens” or disclosing any proprietary information. Further, limit access to your database only to what is needed to provide the service you are requesting.
What about E&O?
Clarify where their coverage starts and yours stops.
Know exactly what you and your agency are committing to
Ask what the term of the contract is, obtain a sample contract for review, and ensure you know about cancellation provisions if your circumstances change. Clarify how the vendor will respond if your volume/needs increase, decrease, or materially change during the contract term. Know your escape clause!
And don’t forget to monitor what is on-going
The vendor will provide direction on what documentation is done within your agency management system, and encourage you to perform your own audits periodically, just as you would for an in-house employee. Ask about auditing and standards the vendor has for their own staff.
Clarify who you would call to resolve any issues and set a structure for regular feedback and process improvement. Your success in maintaining a beneficial relationship with your Virtual Team is as important as if they were “hired” by you…..and they were!
More about the author, VIP’s Norma Milne
Norma Milne, CIC, is the Business Development and Relationship Coordinator for Virtual Insurance Professionals or “ VIP”. Prior to joining VIP, she was a Regional COO for a national insurance brokerage firm. She began her insurance career as a CSR in a twenty employee insurance agency.
Headquartered in Manchester, New Hampshire, VIP is a full-
service firm that helps guide agency principals through the process of outsourcing their agency’s customer service.
To get in touch with VIP about the type of outsourcing services they could offer your independent insurance agency, please contact them here.
