GenAI has taken the world by storm. You cannot attend industry conferences, participate in industry conferences, or plan for the future without GenAI being part of the discussion. As an industry, we are constantly responding to disruptions, evolving market factors (often outside of our control (e.g. consumer expectations, capital market influences, ongoing M&A)) and resolving them. There is almost constant debate about the best way to do this. This includes using modern assets/tools/capabilities that can lead to further growth, higher profit margins, increased efficiency, increased employee satisfaction, etc. However, few of these solutions have been successful in bringing about large-scale changes in revenue-generating roles. Industry…until now.
Technology is primarily developed to increase efficiency and, if adopted properly, can yield several results. However, individuals who need to use technology or input data that enhances insights to increase efficiency often receive little or no benefit from the solution. At its core, GenAI increases the accessibility of insights and can provide actionable insights into organic growth opportunities with clients and carriers, making it widely adopted for revenue-generating roles. It could be the first technology. This is probably the first product to specifically provide “what’s good for you.” Provide actionable insights, not more data, to revenue-generating roles within the insurance value chain.
There are five key use cases that demonstrate the potential of GenAI for brokers and agents.
- Actionable “customers like you” analytics: Brokerage businesses that have grown primarily through the consolidation of acquisitions often find it difficult to identify similar customer portfolios that can provide cross-selling and up-selling opportunities to acquired agencies. GenAI can be used to compare books of acquired agencies, including geography and acquisitions, to identify customers with similar profiles but different insurance solutions, allowing producers to reconsider their customers’ insurance programs. Unlock critical insights and expand customer potential. Insights into where to take action provide opportunities for greater organic growth.
- Submission preparation and client portfolio QA: For brokers and agents without national practice groups or specialized industry teams, insureds in industries outside the core strike zone present challenges in terms of asking the right questions to understand exposure and match coverage. often. The effort required to identify appropriate coverage and prepare submissions can be significantly reduced with GenAI. Specifically, the technology uses what is known about the insured, the industry in which the insured operates, the risk profile of the insured’s company relative to other companies, and what is available. , which can help prompt you what types of questions to ask your broker/agent. in 3rd Party data source. Additionally, GenAI not only supports E&O mitigation, but also acts as a “spot check” to identify upsell or cross-sell opportunities that may have been overlooked. Previously, the quality of portfolio coverage and subsequent submissions was at the complete discretion of the producer and account team handling the account. With GenAI, brokers and agents have years of knowledge and experience in asking the right questions at their fingertips, serving as a QA, cross-sell, and upsell tool.
- Intelligent placement: Risk placement decisions for each customer are primarily determined by the account manager and producer based on the level of relationship with the insurer/underwriter and the known or perceived preferences of the insurer for the client’s particular risk portfolio. will be done. While the wealth of knowledge gained from years of placement experience is noteworthy, the changing risk appetite of carriers due to near-constant changes in client risk profiles makes it difficult for agents and brokers to find the best placement. It’s getting difficult. With support from GenAI, agents and brokers can create submission summaries by comparing the carrier’s stated desires, the client’s risk and policy recommendations, and the details of the agent’s or broker’s financial agreement. This allows account teams to spend less time on marketing, both in terms of finding the best markets and avoiding markets where the risk is unacceptable, while ensuring the best interests for the client and the agent or broker. Get placement recommendations.
- Avoiding revenue loss: As clients choose advisory fees over commissions, they are often charged “under” fees that are not retainer-specific and are attributable to specific risk management measures provided by the agent or broker. GenAI’s ability to theoretically capture customer contracts, evaluate fee-based service contracts within them, and establish an overview that can be provided by tools such as internal knowledge exchange for employees servicing accounts. can. This knowledge management solution can provide specific guidance to employees on what fees should be charged based on contractual obligations, when needed, and help employees with unknown and uncollected accounts receivable. This provides agents and brokers with the opportunity to increase their revenue.
- Deliver client-specific marketing materials quickly: Historically, when an agent or broker wanted to expand a non-core capability (such as digital marketing), they would hire or rent that capability to get the right expertise and the right return on effort. This worked, but SG&A expenses expanded and could no longer be firmly tied to growth. GenAI-type solutions have the potential to solve this problem and deliver better results by giving agents and brokers scalable access to non-core capabilities (such as digital marketing) for a fraction of the investment and cost. there is. As an example, the rapid customization of GenAI’s output allows agents and brokers to generate industry-specific materials for mid-market clients without timely effort (for example, we covering X% of the market and the number of your Z companies). Create one-time sales materials.
The use case we have envisioned is in the prototyping stage, but it envisions a near future where humans and machines will meet for the benefit of revenue-generating activities. There are three key actions he recommends all broker/agent clients take next as they evaluate the use of this technology in their own workflows.
- Focus on a subset of your data. With GenAI, some data must be reliable in order to generate useful insights. A common misconception is that you need all of your agent or broker’s data to leverage GenAI, but the reality is to start small, run, and then scale. Identify the most important data elements to get the insights you need, establish a data governance and cleanup strategy, and improve that dataset before scaling. Doing so provides data sets that can be used in private computing models to deliver value to enterprises before scaling up their data hygiene efforts.
- Prioritize pilot use cases: Like many emerging technologies, the value it provides is tested through the execution of use cases. Brokers and agents can evaluate what the potential high-value use cases are and improve the visibility of those areas using feedback loops between development and revenue generation teams to make necessary adjustments and changes. You should create a pilot to test the value.
- Assess governance and implementation methods. As discussed, the insurance industry has been slow to adopt new technology, so brokers and agents are investing in the change management and implementation strategies needed to demonstrate that this technology may be the first of its kind. you need to be prepared to do so. Significantly impact revenue and organic growth in a positive way for revenue-generating teams.
While this blog post is intended to be a non-exhaustive look at how GenAI may impact distribution, it is important to note that both carrier and MGA underwriting and We have many more thoughts and ideas, including the impact on insurance claims.Please contact us at Heather Sullivan or bob vescio If you would like to discuss further.
Get the latest insurance industry insights, news and research delivered straight to your inbox.
