How is COVID affecting Brokers: What Is the Future of the Broker Industry?

Changes in the local microeconomy and macroeconomy are, of course, affecting a lot of industries. Changes in the insurance field tend to happen before a lot of other consequential changes.

As we begin to get used to the prolonged COVID-19 crisis, inevitably we need to adapt our lives to all other crises which are caused by it.

What we want to understand better is how insurance is already acting in this uncertain time. Check out the text below to learn about some of the ways the pandemic has affected the economy, and the changes the broker industry will have to implement to adapt to the changing world.

Digitalization and, of course, Automation

Homes are not what they used to be. They are now multifunctional spaces. Probably your own home has now become your office, school, kindergarten for your kids, and gym. All new restrictive safety measures related to Covid-19 have forced people and businesses to adjust to working from home. Some with more, and some with less success.

Even though the Covid-19 vaccine is available to the general public worldwide, companies have had to find a way to transfer all aspects of their work online. Insurance brokers who have already had an app and an email marketing plan in place have had a huge head start compared to competitors.

That said – auto insurance, home insurance, health insurance, business disruption insurance, etc. can all benefit a great deal from automation. Automation is not just decreasing the time needed for work to be done. It’s also an increase in productivity, because people involved in the process can be useful in other positions.

The automation process handles a variety of things. For example, you can automate insurance policy renewals and email workflows, and you can even boost online reviews. This way you can help brokers build up online authority.

Brokerage’s call volume is reduced with the proper use of automation. In addition to that, customer experience is improved, because by giving policyholders 24/7 access to their policy documents, proof of insurance, etc. policy holders feel updated and safe all the time.

All services based on feedback and online reviews can be improved as well. Insurance brokers can test their clients’ sentiment easily through industry-standard surveys, such as NPS ®, which are integrated into these communication platforms.

Sending automated emails which are triggered by clients’ online behavior such as purchasing policies or the nearing of their policy expiry date, can result in email click rates, open rates, response rates, and conversion rates skyrocketing.

What is the Future of Consumer Expectations?

Let’s speak about data protection, because as people start shopping, going to school, and working from home, more and more are deciding to purchase cyber insurance.

So consequently, many companies are likely to purchase cyber insurance to protect their big data, and some confidential client data with which they have been entrusted.

This enormous shift to connecting to devices in homes and businesses, and doing most of the business online, has made cybersecurity more challenging. Many of us will purchase cybercrime insurance in following years. According to several reports, consumers are becoming more and more price-sensitive. This happened as millions of people have lost their jobs, or are facing reduced salaries and heightened uncertainty in their overall financial lives.

Another conclusion is that policyholders stated that getting their value for money was their biggest priority, even more important than gaining insight into the peculiarities of their policies, and easier access to insurance-related information online.

The Need to Rebuild a Favorable Reputation Among Consumers

Less than half of policyholders in the U.S. reported that their insurer delivered on the needed support throughout the Covid-19 crisis.

If we speak on a global scale – the figures are even worse. Around 18% of policyholders claim their insurers even failed to communicate their response to the pandemic in a way they can understand. Insurers’ reputation all over the world has suffered as the particular wording of insurance policies allowed insurance companies to not cover Covid-19-caused damages.

So it’s not hard to conclude that people felt cheated due to a poor understanding of the details of their policies. In the next few years, doing a better job in bridging this communication gap will be the top priority of both insurers and insurance brokers.

One way to do this is again email marketing and insurance apps, reminding policyholders to review and carefully read through their insurance policies, and making all insurance information available to them online, just a click away.

Conclusion

Insurance brokers will have to go that extra mile (or two) in order to improve their customer acquisition and retention statistic.

To get with the times they will need to deep dive into online surveys and reviews. Listening to the changing needs and both positive and negative feedback from policyholders will likely give some brokerages the competitive edge they need to stand out over the next couple of years.

Finally, the Covid-19 crisis has shown us that digitization and automation, if used correctly, are the answer to many of the market’s current issues.

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