The New Agent Authority Survey was conducted from June 9 to 25, 2020
Attention. Personalization. Assistance. Guidance. These are the four key things that small business owners want from their independent agents says a new survey from Nationwide. More specifically, many small business owners felt they would benefit from ‘more tailored and frequent insurance advice’ as they navigate the unprecedented COVID-19 public health crisis and its repercussions in the U.S. economy.
The New Agent Authority Survey, commissioned by Nationwide and conducted by Edelman Intelligence, involved a 20-minute online survey of more than 2,600 independent insurance agents and business owners.
According to the survey, there is a major misconception between what independent agents believe their small business clients are interested in talking about and vice versa. Approximately 57% of independent agents surveyed said their clients are ‘too concerned about their business surviving the pandemic to talk to their agent about insurance needs.” However, 6 in 10 of small business owners disagreed with that sentiment, stating that they were actually interested in hearing from their agent. In particular, the survey cited the following four themes that both parties should be discussing:
- Business owners would like more attention from their insurance agents.
- Business owners want personalized policies that fit their unique business needs.
- Business owners would appreciate assistance in better understanding of what is in their policies.
- Business owner will welcome economic guidance from their agents.
Agents should consider communicating with Small Business Owners more often
Agents should reach out to their commercial clients more often. For those agents wary of annoying clients with a standard phone call, agents should be devising new more innovative ways to approach their insureds.
“Small businesses and the independent agents who help protect them continue to face unprecedented and evolving business adversity,” said Cathy Allocco, vice president of Small Commercial Sales and Distribution at Nationwide. “The best agents will ensure clients continue to feel their presence, even virtually, by identifying new ways to strengthen relationships, solve problems and offer peace of mind to clients whose expectations for expertise are on the rise.”
Agents should hone in on providing a more personalized touch
Agents also need to segment and understand the varying needs of both small business and middle market commercial clients. One of the interesting things the survey noted was that while middle market business owners felt agents where available when needed, small business owners did not always feel the same. In particular, the study says:
- 95% of insurance agents reported they’re always there when customers need them, but 1 in 4 small business owners disagree (25%).
- 91% of agents said they can offer the best prices, but 31% of small business owners disagree.
- 94% of agents responded that they regularly check to make sure policies fit their clients’ needs, yet 36% of small business customers disagree.
So while an agent may feel he is sufficiently supporting his commercial clients, it may be worthwhile to reconsider the different needs of small versus middle market business owners and to reach out to them accordingly. To help, Nationwide offered the following two tips for agents interested in tailoring their response to these two groups:
- Identify ways to regularly check in with your commercial customers to understand their changing needs, ensure they’re appropriately protected, and assess whether you can add value through technical expertise or solutions like telematics.
- Leverage digital marketing and social media to reach your customers where they are and elevate your thought leadership profile.
Help small business owners better understand their insurance policy and what it covers
As the economic disruption from the pandemic continues to affect all aspects of the U.S. economy, it is no surprise that the survey results reflected statistics showing that small business owners need greater guidance in navigating the insurance buying and insurance claim process. Many small business owners struggle to understand their insurance policy and what it covers in their business. Alternatively, the survey noted that 55% of agents say they struggle to educate customers on the coverage they need and 46% of agents say providing the level of service customers demand is a challenge.
On a promising note, however, nearly 7 out of 10 small business owners surveyed said that they prefer to work with an independent agent located in close physical proximity to their business. In addition, ‘being able to talk live to a person when you have an important issue or question” ranked as very important to small business owners, particularly when it comes to reviewing a policy.
Other survey findings note that:
- 39% of small business owners are seeking guidance on business interruption or disaster planning.
- 35% of small business owners are interested in safety and loss control resources to mitigate risks.
- 18% of small business customers want information on cybersecurity and retirement.
- Customers prioritize carrier financial strength and stability and name recognition when shopping for insurance; 91% of small business owners place importance on using a company that has strength and stability, and 82% value working with a well-established and well-known carrier.
Giving guidance can be a golden opportunity for interdependent agents
Another major theme the study uncovered concerns the fact that many small business owners ‘wrestle with understanding different types of coverage, the time it takes to settle a claim and keeping up with new technology offered by the insurance industry.’ As a result, they rely on their agent to have the understanding. Unfortunately, many agents also reported their own challenges “…with adopting new industry technology, educating clients about different types of coverage, and helping clients with disaster preparation or mitigation.”
Here is what those surveyed thought about this issue:
- 85% of small business owners agree insurance agents provide assurance that they have the right coverage and protection.
- Understanding what is and what is not covered in their policy (46%), finding the best price for their protection needs (44%) and understanding the level of coverage needed (43%) are small business owners’ top insurance challenges.
The above findings prove what many independent agents might already know. Namely, many small business owners struggle with understanding their insurance policy, and understanding the coverage their business needs. As a result, they rely on their agent’s assurance that they have the right insurance coverage and protection for their needs. Thus, those agents willing to educate themselves about the various industries in which their clients work to understand the nuances and potential issues that may exist will find more success with their commercial clients.
Opportunity in the face of an uncertain future
With six out of every 10 small business owners feeling uncertain about the economy, many commercial clients will be thinking about insurance as a way to either cut costs or to be better prepared for what lies ahead during the next 6-12 months.
Four out of 10 small business owners, however, also claim to be unsure as to whether their agents are ready to discuss the economic challenges affecting their business.With these statistics in mind, agents willing to make the calls and to see the opportunities to provide a higher level of service to commercial clients and to make those difficult initial calls to their clients may be the most pleasantly surprised by the responses they receive.
