To make headway in today’s insurance market, producers must shift from having a“B-2-B” mentality to a “B-2-Me” mentality, said innovation expert Maria Ferrante-Schepis. The “B-2-B” refers to business-to-business, while “B-2-Me” refers to business-to-unique-consumer.
That’s one of the messages she plans to deliver in an innovation workshop today on “extreme problem solving.” The workshop is being held before the official start of the 33rd annual meeting of the National Association of Independent Life Brokerage Agencies (NAILBA) in Hollywood, Fla.
Adopting a B-to-Me focus will help the life insurance industry capture the “new generation of consumers,” Ferrante-Schepis said in an interview with InsuranceNewsNet in advance of her presentation. She is managing principal in the Jersey City, N.Y., office of Maddock Douglas, an innovation consulting firm.
This message applies to all products and services, not just insurance, she said, alluding to research her firm has been doing in this area. Simply put, “the bar has been raised” for how businesses interact with customers, she said.
The way consumers want to buy
Think of Amazon.com and Zappos.com. Both are online shopping venues that give customers a great deal of control and choice on websites that are easy to use. “That’s the way people want to buy stuff today,” she said.
In the insurance industry, everyone in the company and agency “needs to understand what it is that today’s consumers are expecting in delivery and choice, in authentic feeling, and in trustworthiness,” she said.
“Customers want to know that you have their best interests in mind. They want to know you are making the ‘right recommendation for me.’ They want the transaction to be easy to see and follow, with pricing that is transparent.”
This will require the industry, including brokerage general agents (BGAs), to rethink how they do things, and that will definitely “pinch” the BGAs, Ferrante-Schepis said.
In fact, BGAs are already feeling the pinch. “For example, it is becoming harder for BGAs to find producers who can work in the new model successfully,” she said.
Younger producers generally can work in such an environment, the consultant said. The problem is, there are not a lot of those producers today. That is partly because the profession is less attractive to Generations X and Y than to older generations.
For example, the younger generations tend to feel constrained by such things as complex regulations and restrictions on social media. They view these things as keeping them from being able to do their work well.
The role of innovation
“BGAs will need to think of new ways to attract young talent and to get them productive more quickly,” she said. That’s where the innovation comes into the picture. The workshop she is leading today aims at helping BGAs develop “creative problem-solving techniques.”
These techniques are aimed at helping BGAs uncover and develop new types of solutions for their businesses.
In answer to one “homework” assignment that Maddock Douglas sent to the workshop participants in advance of the session, commenters mentioned some areas where they see need for improvements. These included “better underwriting process,” “ease of doing business” and “a less cumbersome way for people to buy.”
Those were “pleasantly surprising” responses, she said. But one commenter touched on a more sensitive area — commissions. This commenter said that “the industry needs to rethink the 28-year-old model of how commissions are paid.”
The person expressed concern that the heaped commission structure, as traditionally used in life insurance, incentivizes producers “to sell stuff that the consumer doesn’t need,” she said.
Ferrante-Schepis found that concern to be at odds with what other BGAs have told her in recent years. Many say, “Don’t touch that,” she said.
Another sensitive area for BGAs has to do with helping producers get going in their careers. The traditional approach of teaching recruits to sell life insurance to friends and family “doesn’t sit well with the new consumers and the younger advisors,” Ferrante-Schepis said. “They want to keep their social lives and their families separate from that.”
For some younger producers, she added, the commission model makes the dynamics worse, in the sense that “it sends a message to ‘hurry up and sell something.’ This contributes to feelings of distrust.”
In view of that, the challenge for BGAs is “how to how make younger producers successful by using techniques that don’t create feelings of mistrust,” she said.
The agent’s mission will not change, nor will the importance of consumers owning insurance, she predicted. “What will change are the trappings around that. The industry needs reinventing, especially where the advisor is involved.”
This extends to the consumer landscape, she said. The industry’s perception, processes, language and other areas need to change in order to be relevant to consumers. The industry also must be perceived as “authentic,” with industry professionals talking the way that consumers talk.
Finally, BGAs and producers must give more attention to the emotional side of the sale, she said. That was commonplace two decades ago, but it’s not that way today. The business has become more efficient and automated in recent years, she allowed, but “today’s consumers demand that you pay attention to them, and be authentic with them about what they really need.”
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