augie technology survey executive summary

Agency Technology SurveyExecutive Summary

2006

The 2006 AUGIE Agency TechnologySurvey was created by leaders from

agency management system user groups, inconjunction with ACORD, carriers, vendors,association representatives and other partici-pants. The goal of the survey was to identifychanges in agency automation that haveoccured since a similar AUGIE survey wasconducted (in early 2002), and to uncoverdevelopments agents and brokers felt carriersand vendors should address.

More than 7,500 agency, brokerage, MGAand wholesaler professionals took part in the survey, which was available online from

late January through mid-March.

The survey, which took participants an average of 25 minutes to complete, includedroughly 180 questionsÑfour times the number contained in the 2002 survey.

But few participantsÑif anyÑeven saw 100 questions. That’s because, based on earlyanswers, subsequent questions were eitherdelivered or passed over, so only relevantquestions were fed to participants. Forinstance, some were designed solely for principals and senior management.

2

© 2006 ACORD Corporation – All Rights ReservedAUGIE – ACORD User Group Information Exchange

Updated 5/31/06

The ACORD-User Groups Information

Exchange was formed in 2000 to

research and share information among

business partners who play an important

role in the independent agency system.

A 2002 automation survey was

AUGIE’s first major project—an initiative

designed to explore, on a wide scale, vari-

ous agency workflow and technology

issues. The survey sought information from

management and support staff, and pro-

vided the foundation for carrier and

vendor initiatives built, in large part,

around ACORD standards.

Actions based on the 2002 survey

brought broader and faster implementa-

tion of real-time transactions, improve-

ments in commercial-lines download func-

tionality, and better relationships between

agents and the companies they represent.

Today, carriers and vendors say they are

eager to learn the latest survey results as

they plan automation development for

2007 and beyond.

Background

IntroductionDemographics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Impact of Technology on the Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

State of TechnologyPolicies in Place . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Taking Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Working the Web . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Passion for Paperless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Technology Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

What Agents WantMaking or Breaking Expectations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Ease of Doing Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Download . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Real-Time Functionality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Quoting Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Moving ForwardVision for 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Agency Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Table of Contents

Agency Technology Survey — Executive Summary 20063

Note: Percentages shown are based on the total number of responses to the particular question. Quotations are from survey participants andwere provided during the survey.


Updated 5/31/06

During the two months it was live, the survey achieved a 53% completion rate. Input camefrom every part of the independent agency system, and from all levels of staff within individualagencies and brokerages.

Most respondents who identified their business type chose “independent agent,” followed bybroker and MGA.

The survey achieved broad representation within each office. At the top level, roughly four in10 individuals identified themselves as agency principal or member of agency senior manage-ment.

4

Demographics

What type of organization do you primarily work for?

Other

Wholesaler

Independent agent

Captive agent

MGA

Broker

Independent agent 86.5%Broker 8.9%Managing general agency 1.6%Wholesaler 1.0%Captive agent 1.0%Other (specify) 1.7%

Are you the principal or a member of the senior management of the agency?

Yes

No

Yes 41%No 59%

INTRODUCTION

5Agency Technology Survey — Executive Summary 2006

Agencies of all sizes were well represented in the survey. A quarter of respondents indicatedrevenues of between $2.5 million and $10 million.

A range of agency management systems also was represented. Standard AMS Services andApplied Systems management systems each accounted for slightly more than a third of allresponses. Instar, Ebix, Strategic Information Systems, MI-Assistant and DORIS each garneredbetween one and five percent representation. Interestingly, 2.5% of respondents say they builttheir own system, and 4% claim to use none.

Forty-three percent of those who chose “none” go directly to carrier Web sites. Thirty percentof them don’t believe the agency needs a system, while 12% plan to buy one.

What are your agency’s total yearly revenues for all locations combined?

Under $150,000

$2,500,000 -$9,999,000

$150,000 -$499,000

$500,000 -$1,249,000

$10,000,000or more

$1,250,000 -$2,499,000

Under $150,000 6.3%$150,000 - $499,000 19.2%$500,000 - $1,249,000 19.5%$1,250,000 - $2,499,000 17.5%$2,500,000 - $9,999,000 24.4%$10,000,000 or more 13.0%

[My agency bypasses the agency management system] “because companies refuse to adopt real time. They areafraid to provide the critical tool to their marketers, for fear of losing business and control. It is a historic barrier to insurance

marketing efficiency that they desire to maintain.”

6


Updated 5/31/06

Agents and brokers and their staff were candid in their description of what technology has andhas not done in their agencies. Nearly 90% of respondents agree—strongly or somewhat—thatthe adoption of new technologies has enabled the agency to become a more effective salesorganization. Eighty-eight percent of respondents believe new technology procedures have hada significant or moderate impact on pro-active client servicing in the agency. Eighty-four per-cent say the new technology procedures have had a similar impact on reducing staff processingtime.

Impact of Technology on the Agency

The adoption of new technologies has enabled our agency tobecome a more effective sales organization.

Strongly agree 44.1%

Somewhat agree 44.9%

Somewhat disagree 9.4%

Strongly disagree 1.6%

What level of impact have new technology procedures had onreducing your staff’s processing time?

Significant impact 43.6%

Moderate impact 40.6%

Very little impact 12.5%

No impact 3.4%

Strongly agreeStrongly disagree

Somewhatdisagree

Somewhatagree

Significant impact

No impact

Very littleimpact

Moderateimpact


At the end of the day, respondents believe technology has had an overall positive impact ontheir business. When asked, “What level of impact have new technology procedures had on theoverall value of your agency?,” 65% of those who had an opinion said the value of the agencyhas increased. Only 1% of respondents perceived a drop in value.

What level of impact have new technology procedures hadon the overall value of your agency?

Increased

Decreased

No change

Agency value has increased 64.9%

No change in agency value 34.1%

Agency value has decreased 1.0%

“Following the hurricane, which devastated our area, our technology allowed us to stay in business. Our office and every

piece of paper were destroyed, and without our technology, wewould not have been able to serve our customer’s needs.”

“We grew 35% last year, but we did not have to add any employees.”

8

While agencies and brokerages have, for the most part, responded to technology-related devel-opments and their impact, opportunities exist for user groups, vendors, associations and othersto drive further action.

For instance, the issue of automation security has taken center stage in many businesses.Eighty-five percent of respondents say they've adopted a specific automation security policywithin their agency. Still, this leaves 15% without such a policy.

A higher percentage of respondents say they've implemented a policy to protect client informa-tion. Ninety-four percent agree—more than 60% strongly so—with the statement: “Our agencyhas adopted a specific policy to protect the privacy of clients’ information.”

Policies in Place

Our agency has adopted a specific policy toprotect the privacy of clients’ information.

Strongly agree

Strongly disagree

Somewhatdisagree

Somewhatagree






Updated 5/31/06

STATE OF TECHNOLOGY


When it comes to traditional disaster planning, though, agencies have been less diligent. Sevenout of 10 respondents say their agency has adopted a specific disaster-preparedness plan,despite continual calls from associations, carriers, vendors and user groups. This leaves nearly30% who say they are operating without a formal plan.

Our agency has adopted a specific disaster-preparedness plan.





Strongly agree

Stronglydisagree

Somewhatdisagree

Somewhatagree

10

Taking Responsibility


Updated 5/31/06

For the most part, agents and brokers who took part in the survey say they consider technologyto be a strategic initiative. Fifty-five percent of principals and senior management agree strongly that their agency has in place an active strategy to improve their business by imple-menting technology improvements as they are introduced. An additional 40% say, with lessconviction, that they have such a strategy.

Asked if staff must implement technology improvements when the agency adopts them, a higher percentage—three-fourths—of agencies strongly agree. Another 22% somewhat agreewith the premise.

My agency has an active strategy to continuously improve the business by implementing technology

improvements as they are introduced.





Our agency staff is required to implement technology improvements when they are adopted by our agency.






Somewhatdisagree

Somewhatagree


Somewhatdisagree

Somewhatagree


When it comes to training, responses are less fervent. More than 40% strongly agree with thefollowing statement: “Our agency provides systematic training of employees regarding theimplementation of new workflows and technologies.” Another 47% somewhat agree with thesame statement.

Our agency provides systematic training of employees regardingthe implementation of new workflows and technologies.





“It is extremely difficult to train people on 20 different carrier Web sites. Each company is doing things differently

with upload, download, new business, Web sites—it is a technological mess.”


Somewhatdisagree

Somewhatagree

12


Updated 5/31/06

Given the amount of time agencies have had to develop and implement a Web presence, a sur-prisingly high number have not done so. Or if they did, they abandoned it. Just fewer thanthree-quarters of principals and senior management say their agency or brokerage has a Website. And of those that do, it’s often left static for long periods of time—perhaps in perpetuity.

Despite the lack of Web presence and freshness, agents and brokers recognize that Web sites willcontinue to evolve from brochure sites to interactive client resources. They indicate belief thatcustomers will want or expect expanded functionality and access to policy information over time.

Working the Web

How often is your agency Web site updated? Continuously

Never

Annually

Rarely

MonthlyContinuously 30.7%

Monthly 13.1%

Rarely 35.1%

Annually 17.9%

Never 3.2%

Web site features Now offered Will want Changeon Web site or expect

Real-time interaction 47 608 1,193%

Billing information (what they owe) 84 937 1,015%

Claims inquiry/status 97 810 735%

Policy info (coverage and premiums) 123 861 600%

First notice of loss 220 801 264%

Policy service 218 790 262%

Changes to policy 232 807 248%

Certificates 254 851 235%

Reporting of claims 308 833 170%

Quotes 539 903 67%

Brochure 786 679 - 15%

Other 284 102 -64%

One area where agencies are focusing, and where staff is supportive, is in a move toward paperless. More than 75% of agencies claim to have a major strategy to go paperless and/orremain paperless. Comments received (where free-form answers were sought) indicate that staffmembers believe going paperless has driven considerable benefits to the agency in a number ofways—customer service, sales focus, time savings and increased productivity.

Passion for Paperless

Our agency has a major strategy to go paperless and/or remain paperless.





“Paperless rocks. You can do twice the work with half the stress of paper stacking up on your desk....”

“We converted to an image-driven workflow about two yearsago in personal lines. The result was an increase of revenue per

CSR of about $75,000 each. In commercial, imaging wasimplemented six months ago; average increase in revenue per

CSR to date is about $40,000.”


Strongly agree

Stronglydisagree

Somewhatdisagree Somewhat

agree

Two areas that cause anxiety among many agents and brokers are dealing with proprietary company systems or Web sites and redundant data entry. Roughly half of all respondents saidthat learning and using various company proprietary systems was the agency’s greatest chal-lenge in supporting automation. Its close cousin, managing multiple user IDs and passwords,was second. Asked about top challenges for supporting interface, agents and brokers ranked different proprietary company interfaces number one, followed by duplicate entry and multipleIDs and passwords. Duplicate entry earned the dubious spot as number one “time waster”when it comes to automation—by a nearly four-to-one margin over its next closest competitor.

14

Technology Challenges


Updated 5/31/06

What is your agency‘s greatest challenge in supporting automation?

2.4%

12.8%

48.9%

10.5%

20.2%

1.7% 3.5%Learning and using variouscompany proprietary systems 48.9%

Multiple user IDs and passwords 20.2%

Time and expense of keepingup with changing technologiesand updating versions 12.8%

Time and expense of educatingand training of staff 10.5%

Budgeting IT 2.4%

Finding quality technical resources (including outsourcing) 1.7%

Other 3.5%

What is your agency’s greatest challenge in supporting interface?

4.2%

13.2%

35.9%

11.6%

28.2%

2.1% 4.8%

Different proprietary companyinterfaces 35.9%

Duplicate entry 28.2%

Multiple IDs and passwords 13.2%

Training agency staff 11.6%

Managing real-time 4.2%

Password reset 2.1%

Other (specify) 4.8%


What is your major automation “time waster”in doing business today?

10.0%

11.5%

46.6%

11.1%

12.4%

5.0% 3.4%Duplicate data entry 46.6%

Proprietary programs/softwareproducts 12.4%

Manual verification of uploadand download transactions 11.5%

Carrier does not provide accessto real-time data 11.1%

Multiple user IDs and passwords 10.0%

Insurance scoring 5.0%

Other 3.4%

“Ease of doing business is no longer easy. With each carrierrequiring use of its own rating system, it takes four times longer to rate risks than it used to. To be more efficient, the time elementneeds to be improved for comparative quoting.”

“Ease of use is critical and duplicate entry is killing us. The expenses are actually higher than when we had

paper files only. Carriers have to find a way for agents to do this once and be done!”

16


Updated 5/31/06

Part of the survey looked at features agents would find useful in their agency management sys-tem, compared to what is currently available. For the most part, a gap seems to exist betweenwhat agents want and what management systems offer.

When asked, “How important is it for your agency to have the ability to customize your clientdata in the agency management system?,” 73% of respondents said it is extremely or veryimportant. Only 53% said they currently have that capability in their system. When asked,“How important to you is it to have your agency management system provide you with a fullclient view of all the business you have with that client?,” 89% answered extremely or veryimportant. Yet only 70% said their system offered that capability.

Making or Breaking Expectations

WHAT AGENTS WANT

How important is it for your agency to have the ability to customizeyour client data in your agency management system?

ExtremelyimportantNot at all

important

Important

Not veryimportant

Veryimportant

Extremely important 42.3%

Very important 30.8%

Important 19.9%

Not very important 6.2%

Not at all important 0.9%

Do you currently have the capability to customize your clientdata in your agency management system?

Yes

Don’t know

No

Yes 52.9%

No 26.9%

Don’t know 20.2%


The largest gap came when participants were asked, “How important to you is it to have yourmanagement system allow you to set ‘exceptions’ with regard to incoming data, finances, cov-erage gaps, employee performance, etc., and then flag those exceptions for you to focus on?”Fifty-four percent described it as extremely important or very important, while only 23.5% saidtheir system currently offers that functionality.

Beyond this functionality, an opportunity exists for vendors and user groups to better educateusers on what agency management systems offer. For instance, one in five respondents say theydon’t know if their system allows them to customize client data. And more than a third—37.5%—say they are not aware if their system provides the ability to set “exceptions.”

How important to you is it to have your agency management system provide you with a full client view of all the business

you have with that client?



Important 9.3%



Do you currently have the capability for a full client view of all the business you have with that client?

Yes 69.7%

No 23.0%

Don’t know 7.3%

ExtremelyimportantNot at all important

Important

Not veryimportant

Veryimportant

Yes

Don’t know

No

18


Updated 5/31/06

One area where management systems seem to meet expectations is in their ability to trackprospect information. Thirty-four percent of respondents said it is extremely important that systems do this, while 31% said it was very important. Seventy-two percent of respondents said their systems currently deliver this capability.

How important to you is it to have your agency management system provide you with the capability to track prospects?



Important 23.9%



Do you currently have the capability to track prospects?

Yes 72.2%

No 17.3%

Don’t know 10.6%

“Cost-effective solutions for automation based on agencydesired workflows are desperately needed for agencies. We need to develop automation to be a tool, not a task.”

Extremely important

Not at allimportant

Important

Not veryimportant

Veryimportant

Yes

Don’t know

No

Technology advances within insurance and in other industries are showing agents and brokersand their staff that it is possible to make business processes more simple. Agency and brokerageprofessionals yearn for the ease of doing business these workflow and automation tools support.It's become an increasingly important factor in their decision to place business with a carrier.

In answers to several market-centric questions, agents and staff identified ease of doing business as the number one driver in their decisions about where to place business. In personallines, for instance, it was the most important criterion for 43% of those surveyed, followed byprice (31%) and product (20%). For small commercial—accounts generating less than$15,000—ease of doing business was chosen by 45%; price and product got 33% and 16%,respectively.

For larger commercial, ease of doing business dropped in ranking. The top three drivers for placing medium commercial were price (35%) ease (30%) and product (29%). In large commercial, product earned top honors (48%) followed by price at 28% and ease at 16%. Forfinancial services, specialty and surety, ease of doing business earned first or second place, with responses ranging 34% - 71%.

Over the last two years, my agency’s ease of doing business with a carrier has become an increasingly important factor

in my agency’s decision to place business with that carrier.





19

Ease of Doing Business



Somewhatdisagree

Somewhatagree

Thirty-six percent strongly agree—and 42% somewhat agree—that difficulty in securing multiple quotes has restricted the number of carriers from which they seek quotes. And morethan three-fourths say they’d be more likely to choose a carrier, regardless of price, if theagency management system could pre-fill some of the fields on a carrier’s proprietary Web site.

It’s clear, according to survey responses, that carriers who have not yet done so have opportuni-ties to implement technology that increases agent and broker ease of doing business.

20


Updated 5/31/06

Would your agency be more likely to choose a carrier—even if it is not perceived to be the lowest price—if your agency management system could pre-fill a percentage

of the fields on that carrier’s proprietary Web site?

Extremely likely 13.7%

Very likely 28.0%

Somewhat likely 34.9%

Not very likely 19.6%

Not at all likely 3.9%

How many of your carriers do you feel have implemented technology (download, real-time, online rating, etc.)

that has increased your ease of doing business?

MostAll

None

Some

All 7.5%

Most 50.0%

Some 37.5%

None 5.0%

Very likelyExtremely likely

Not verylikely

Not at alllikely

SomewhatLikely

Since the 2002 AUGIE agency automation survey, carriers have increased the use of downloadfor personal and commercial lines. In general, agents have expressed satisfaction with how per-sonal download has functioned. Commercial lines download has faced more challenges, andAUGIE and other groups have worked to resolve some of the issues.

In the 2006 AUGIE survey, respondents shared where download does or would deliver thegreatest benefit. When asked about specific transactions, agents and brokers chose download of new business submissions, renewals and endorsements—in that order—as most beneficial.

Questions also addressed product lines. In personal lines, by far, agents and brokers chose auto-mobile as the product where download offered the most benefit. BOP, commercial auto andpackage policies were the top vote-getters in commercial lines, each receiving the nod fromone-fourth to one-third of respondents.

21

Download


Please select which of the following transactions is/would be the most beneficial to you to have downloaded?

(Top five of nine answers are shown.) New-businesssubmission

Paymentsreceived

Cancellations

Endorsement Renewal

New-business submission 30.0%

Renewal 21.7%

Endorsement 20.6%

Cancellations 9.1%

Payments received 6.2%

For personal lines, select which line of business is/would be the most beneficial to you to have downloaded?

(Top three of 14 answers are shown.)Auto

Package

Homeowners

Auto 72.5%

Homeowners 11.2%

Package 6.1%

Almost 40% of accounting responses indicated direct-bill commission statements, beating thenext two choices—company statement (account current) and direct-bill status—by roughly atwo-to-one margin.

22


Updated 5/31/06

For commercial lines, select which line of business is/would be themost beneficial to you to have downloaded? (Top five are shown.)

BOPSpecialty lines

E&S

Package Commercialauto

BOP 32.3%

Commercial auto 25.8%

Package 24.1%

Excess & Surplus 3.5%

Specialty lines(EPLI, D&O, E&O, Fiduciary) 3.1%

For accounting, select which transaction is/would be themost beneficial to you to have downloaded? Direct-bill

statementOther

Commissionamount

Direct-billstatus

Commissionpercentage

Companystatement

Direct-bill commission statement 39.4%

Company statement(account current) 22.5%

Direct-bill status 18.8%

Commission percentage 9.9%

Commission amount 5.6%

Other 3.9%

“After implementing direct-bill commission statement download,we were able to eliminate two weeks’ worth of data entry eachmonth for one person. Imagine how much better it would be if thistechnology were available with life/health carriers also!”

Asked what claims transaction is or would be most beneficial for download, adjuster and officeinformation garnered the most responses, followed by information on claims payments, openclaims and closed claims.

Claims download would serve more than just claims people. Agents also would be betterinformed by having access to up-to-date claim status many respondents believe they’re now missing.


For claims, select which transaction is/would be the most beneficial to you to have downloaded?

ClosedOther

Loss runs

Claims adjusterand office

information

Contact information

Reserve

Open

Payment

Claims adjuster and office information 26.7%

Payment 20.5%

Open 16.1%

Closed 12.0%

Loss runs 11.3%

Other 6.8%

Contact information 4.8%

Reserve 1.9%

“Commission download has been a lifesaver!”

The agent often is out of the loop as to claim status.





Don’t know 5.2%

Strongly agreeDon’t know

Somewhatdisagree

Stronglydisagree

Somewhatagree

The ability to conduct real-time transactions has increased dramatically since the 2002 survey.Agency management system vendors and others now interact with carriers to drive a range ofinquiry and other capabilities for agency and brokerage professionals. The lion's share of theseinvolve inquiries. Of 6,900 individuals who were asked which real-time transactions they use,only 825 said “none,” and nearly 4,000 answered “billing inquiry” and/or “policy inquiry.”

The call to develop real-time inquiry functionality came out of the 2002 survey. The surveyactually helped drive a shift from where many carriers were headed in their development work,and resulted in automation changes agents actually have adopted and incorporated into theirworkflows. As real-time inquiry capability has matured, and more and more agents and brokerssay they are using it, the push should now be toward real-time new business processing,endorsement processing and quoting, the survey says.

24

Real-Time Functionality


Updated 5/31/06

Which real-time transactions does your agency use?

0

500

1000

1500

2000

2500

3000

3500

4000Billing inquiry 3,989 Policy inquiry 3,952 Claims inquiry 3,480 Endorsement processing 2,870 Rating 2,787 Loss runs 2,279 First notice of loss 1,351 Instant notification through

agency management system 538 None 825

What should be the carriers’ top priority related toreal-time automation?

None

Renewal processing

New businessprocessing

All others

Policy inquiry

Billing status

New business processing 27.8% Endorsement processing 25.6% Quoting 15.7% Billing status 7.0% Renewal processing 5.4% Policy inquiry 5.3% Others 11.2% None 2.0%

Endorsementprocessing

Quoting

To gauge the value of real-time, the survey asked what impact real-time functionality wouldhave on workflows. Agents and brokers overwhelmingly believe real-time will help. Forinstance, 89% agreed—64% strongly so—that real-time endorsement issuance or changerequest will have a positive impact.

Survey participants were given a chance to choose from suggested real-time quote and issuescenarios. The top preference, selected by one-third of respondents, was “Using your agencymanagement system, request a real-time quote and receive an immediate premium quoteresponse. Request policy upload overnight for issuance. Policy is issued the next day and down-loaded by the company to your agency management system.”

Next on the list was “Using your agency management system, request a real-time quote andreceive a premium quote response. Request issuance real-time and policy information is immediately returned and printed at the agent’s office. Policy record is downloaded the nextday.” That option was preferred by 22% of agents and brokers. Seventeen percent chose “Usingyour agency management system, request a real-time quote that automatically pre-fills companyspecific screens, which you complete on the company system to secure an immediate premiumquote. The policy is issued and downloaded the next day.”

More than 10% opted for “Using your third-party comparative rating system, request a real-time quote that automatically pre-fills company specific screens which you complete on thecompany system to secure an immediate premium quote. Policy is issued and downloaded thenext day.” Seventeen percent said they did not like any of the choices.


Real-time endorsement issuance or change request will help in my workflow.





Don’t know 6.5%

Strongly agree

Stronglydisagree

Somewhatdisagree

Somewhatagree

Don’tknow

Several survey questions addressed quoting—a hot topic for many agents, brokers, MGAs andwholesalers. Respondents were queried on predominant methods of securing quotes for variouslines, then asked how they'd prefer to obtain quotes. Gaps were identified.

For instance, in personal lines, carrier Web sites and desktop comparative rating were the toptwo choices, selected by 61% and 21%, respectively. In commercial lines, paper applications(faxed, e-mailed or mailed) was selected by 49%; carrier Web sites was chosen by 41%. Forspecialty lines, faxed, e-mailed or mailed applications earned the top spot (70%), with carrierWeb sites taking second (18%). Responses for financial services indicate carrier Web sites asnumber one (47%), with faxed, e-mailed or mailed applications being the top current methodfor 33% of respondents.

Nowhere did “real-time quote through the agency management system” earn one of the top two predominant methods. But that’s the number one answer when agency and brokerage professionals were asked what they want. Thirty-eight percent say they would prefer thatmethod, followed by carrier Web sites, with 28%. Other methods each garnered around 10% or 11% of the nods.

26

Quoting Business


Updated 5/31/06

What is your preferred method of securing a quote? Real-time

quoteOther

Applicationsfaxed, e-mailed

mailed

Comparativerating—desktop

Comparativerating—Web site

CarrierWeb site

Real-time quote through the management system 38.2%

Carrier Web site 28.5%

Comparative rating - Web site 11.1%

Comparative rating - desktop 10.8%

Applications faxed, e-mailed, mailed 10.4%

Other 1.0%

“Ideally we would love to be able to log onto our agencymanagement system, enter the data and then be able to ratethrough it, rather than having to go into 15 different company Web sites a day.”

Survey participants say, overwhelmingly, that real-time quoting will improve their operationsand improve how they serve customers. Nearly nine out of 10 respondents believe that to betrue—58% strongly so. Only 5% disagree.

Besides responding to agent and broker needs, carriers may be able to gain business—or at leastget an opportunity to see more submissions—as they begin to offer real-time quoting throughmanagement systems. Agents will be able to reuse data, and consider more carriers—somethingindicated in the 4,300 or so responses to a survey question on the difficulty of securing multiplequotes. More than 70% say the difficulty in securing multiple quotes keeps some carriers out of the game.






Don’t know 8.2%

Real-time quoting will help in my workflow.





Don’t know 7.5%

Difficulties of securing multiple quotes have restricted the numberof carriers from which I seek quotes.

Strongly agree

Stronglydisagree

Somewhatdisagree

Somewhatagree

Don’tknow

Strongly agree

Stronglydisagree

Somewhatdisagree Somewhat

agree

Don’tknow

Principals and other members of senior management have contemplated what the agent, broker,MGA and wholesaler world will look like in the future. And the 2006 AUGIE survey capturedsome of their thoughts—on client data and service issues, and on staff roles and responsibilities.

Survey responses show that 77% of principals and senior managers believe the independentagency or brokerage of 2011 will need to offer round-the-clock access for clients who want todo business after hours. Thirty-five percent feel strongly this will be the case. More than nine in10 respondents said that, in five years, the agency will maintain more customer-specific datathat will let it respond to individual client preferences.

28

Vision for 2011


Updated 5/31/06

MOVING FORWARD

In my agency in five years, we will maintain more customer-specificdata in order to respond to the preferences of specific customers.





“Automation and a ‘paperless’ office speeds up turnaround timeand allows you to focus more on sales, rounding accounts and gapsin coverage that could be sold.”


Somewhatdisagree

Somewhatagree

Similarly, principals and senior managers see changes in staff responsibility. They expect anevolution from processing to marketing and advising—a move that can be supported byeffective automation deployment. Specifically, nearly three-fourths of respondents believe theagency of 2011 will devote much less staff time to processing. Larger numbers see servicingstaff taking a greater role in marketing functions, such as account rounding (91%) and in therole of professional advisor (80%).


In my agency in five years, there will be a major reduction inthe amount of staff time spent on processing.





In my agency in five years, servicing staff will be more marketingoriented, seeking to round out accounts.





Somewhat agreeStrongly agree

Stronglydisagree

Somewhatdisagree


Somewhatdisagree

Somewhatagree

Agencies clearly recognize that automation requires commitment of time and money on theirpart. The survey offered insight into investments principals said they would make to drive con-sistent workflows through automation. Topping the list was staff training and education, soft-ware upgrades, user-group participation and hardware upgrades, in that order. By and large,principals are planning for these expenses, as shown by answers to questions about the agency’sannual budget.

30

Agency Investments


Updated 5/31/06

What automation (agency management system and others) investments would you be willing to make over the next

12 months to maximize consistent workflows?

0

500

1000

1500

2000Educate and train staff 1,584

Upgrade software 1,003

Participate in user groups 887

Upgrade hardware 882

Improve communication speed 832

Enhance Web site 811

Other (specify) 60

Which of these are included in your agency’s annual budget?

0

500

1000

1500

2000Educate and train staff 1,546

Upgrade hardware 1,351

Upgrade software 1,255

Participate in user groups 811

Improve communication speed 639

Enhance Web site 686

Other (specify) 52

www.acord.org

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