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How Insurance Agents & Brokers Will Succeed in 2022

Thank you for joining us, i'm Jenny and i'm honored to lead the travelers institute. Welcome back to wednesdays, with  a webinar series where we convene leading experts for conversations around some of today's biggest challenges. Today we explore the keys to success at today's top performing insurance agencies and firms in an ever-changing market landscape. As always we're going to be sending out the replay of this program in the next few days, so keep an eye for that before we get started. I'D like to share our disclaimer about today's webinar, a huge thanks to our partners today for this session, the council of insurance agents and brokers, the metro, hartford alliance, the american property casualty insurance association and the masters in fintech program at the university of connecticut school of Business now, let's get started so in a world of rapid change.


How do insurance leaders continue to thrive? What technology advancements are setting insurance leaders apart? What shifts are happening in the distribution landscape? And what does this all mean for your business? So to help answer these questions today, i'm pleased to be joined by ken creare and pete hurd.

So ken, as many of you know, is president and ceo of the council of insurance agents and brokers, a leading washington-based trade association representing the top 200 commercial insurance brokerages. In the world he first joined the council as chief lobbyist and director of political action committees, as as president now ken built the organization into a global leader in commercial insurance and employee benefits. On his read, the council has had tremendous impact in the insurance community from launching their leader's edge magazine to establishing the council foundation to help create the world federation of insurance intermediaries. That'S just to name a few on ken's read, so thank you, ken we're so pleased to have you on today's session. Also joining me today is travelers pete heard he's the executive vice president of enterprise distribution.

Nick is responsible for the overall development and execution of the company's distribution strategy. I'm really thrilled to get your perspective today, pete pete has a long track record at travelers managing key agent and broker relationships over many many years. He also did business development and a business analytics. He is a tremendous asset for us at travelers and for the industry and we're really lucky to have him so pete and ken are going to share their insights to help our agents and brokers succeed in this constantly changing landscape. Today, ken's going to kick us off with an opening presentation and then hand it over to pete after that, i'll come back on and keep the conversation rolling and we're going to take your questions today, like we always do so.

Please put those in the q a uh while you think of questions during their presentations, so uh. Thank you for both for joining our virtual uh session and ken the floor. Is yours thanks joan and thanks pete for joining us today. I'M really excited to be here. As joan mentioned, the council is made up of 200 commercial insurance and employee benefits intermediaries, firms in the us, and abroad, and i know we all use different terminology as brokers and agents. So i wanted to cut out right call out right from the beginning what, when, when i reference brokers, i'm referring to all intermediaries uh in general, our members place 90 of all pc premium and 70 percent of all eb business in the us, and they run the Gamut from the retail brokers to bank owned public and privately held mgas and mgus wholesalers and insure tech firms. All this to say, our membership is very diverse, with different perspectives and objectives. Today, i'm sharing my own thoughts and insights, not speaking for any of our members. Let'S let me spend a minute reflecting on 2021, it's been a wild ride, a tough two years for anyone in any kind of leadership role.

One of the biggest challenges has been. Everything is made all the decisions we make are made in the context of shifting sands you're as a leader in this industry, you're you're constantly saying i don't know or you're thinking. I don't know we don't have all the answers and then, when you add the component, that if you look at some of the adelman's trust survey stuff that came out recently, you'll notice that employers are where people are looking to for information and those employers are coming To insurance brokers and agents, and so the theme today of how do insurance leaders continue to thrive is really exciting. Let'S just pause on the fact that our industry, despite its absolute chaos of the last two years, is thriving. Of course, we haven't been isolated from the pandemic; no one has, but we don't have people leaving out leaving our industry in droves.

Our business has been somewhat stable. There'S plenty of great jobs available, as many of you know and kovit has really accelerated changes that were needed to get us on the same footing as other industries when competing for talent. Most of us were really pretty uneasy about the remote work, as this has always been a face-to-face business, but when that was taken away, we adapted, and we learned a lot about ourselves and how we can serve our customers in different ways. In many ways the pandemic has strengthened the relationships we have with our clients. They'Ve always come to us for counsel, but during the pandemic, they've relied on us for advice in ways that they hadn't before, and i think that's because we had already established a level of trust.

It's all about trust. It always has been so when things were feeling really tenuous and uncertain. Our clients felt comfortable, leaning on us for support, so we'll get into that challenges a bit. But when you look at the grand scheme of things, our industry is well positioned to come out of this, with many lear, with much that we've learned from about how to better serve our clients and improve their experience going forward. So let me talk a minute about the challenges and the opportunities the emerging risks that we're all facing.

One major challenge we're facing is not only risks involving, but they're, also becoming more complex, there's also some risks that were greatly exacerbated by the pandemic. Cyber is an example, but we're not just talking about hackers and fishing anymore. The internet of things and creative connectivity makes everything really efficient, but that connectivity comes with more cyber risks. Those of you who have teslas can can attest to that. Then you have social trends.

Like increased litigation against businesses and corporations, litigation against insurance companies specifically is definitely an issue driving challenges for carriers and leading to higher prices in certain lines like dno, the changing climate has also bringing new weather patterns and higher risk associated with natural catastrophes. Climate is an issue that we're all struggling with and, as all these risks evolve and become, more complex, insurance solutions become nuanced. So i expect we'll see more and more brokers start to specialize in certain areas, which is, in my opinion, is an opportunity to build brand loyalty. So what do i mean by that? If you build up a capability and the client knows that your entire firm, not just the individual broker - is investing in research and data and information to get ahead of wherever the risk might face, the more likely they stay loyal to you as a brand and to The and if the broker were to move on or move or be taken away or stolen, this is a very relevant to carriers as well, and it's part of what's driving m a activity.

A firm that acquires wants these areas of specialization. There'S it's all about scale, and one of the things that i keep hearing from aggregators is one of the reasons they're aggregating is they're building out scale. They have scale to provide services necessary to support their clients m a there's, a flip side to every coin and m a is no different, and in 2021 there were more than 1100 individual acquisitions. It'S a great sign for our business. It shows there's confidence in our industry and many firms and from what we're reading and hearing m a activity will continue to be strong.

This year there are some. There will be some headwinds. We obviously know more than we do now about what than we did. Last year about the virus, but we still don't know exactly how and for how long covet is going to impact us. I wish i had a simple answer, but we don't and there will likely be more attention from regulators on the larger mergers.

We saw that last year with aeon and willis towers watson, and i think there was another comment in today's paper about a different industry. But another another merger, so the department of justice is looking at all these anti-trust issues. We also still don't know what changes the administration is going to make in regard to tax policy and interest rates, but all these factors notwithstanding, i think we can expect a very busy 2022.. However, if the m a arena stays strong, what does that mean for firms?

Looking to build and integrate their teams, there are some firms that have grown from a hundred to a thousand employees all spread out across the different geographies. None of these people have ever been in the same room together, and i i heard just yesterday from one firm that was for the first time trying to pull everyone together, uh in about two weeks and they got cancelled and that's what that's the kinds of things That are happening and the employees who do have opportunities to work together in an office may still be remote because of kovit. So employers are really going to have to get creative to get their teams engaged meld. Those groups together and have everyone singing from the same sheet of music and there's a there's, a simple set of expectations around simple issues, and i think that one of the things that's clear to me is that the empathy that's necessary for you to hold on to People is going to be critical, so we know that we can't separate the consumer experience from the professional experience, because professionals are consumers. Everything has to focus on consumers if there's a special sauce in any industry.

It's it's the it's. The fact that we brokers are sort of maintain the relationship and understanding of their consumers, so what's going on there? Well, it's it's changing very dramatically. I can go online and see exactly where my five dollar package is at any given moment, but i can't go online and see what kind of business insurance i have in place in one package now. I don't think our clients are expecting us to be amazon, but transparency is going to become more important every day and when we talk about transparency, this could mean transparency in data policy, details and fees.

Each firm or organization is going to have to decide what that's meant for their business and decide what how much their clients want it or don't. The bottom line is that the demand for transparency is growing, and i see it as an opportunity to build trust with our clients and to build out that brand. I must i keep coming back to it's about that client experience. The client experience is what's changed if each one of you think about how you demand, how you buy things today, you used to run to the ace hardware. Now you just go hop on amazon and you pop on you order something and it comes the next day and you're fine with that.

But it's that immediacy is that and you also have an opinion on whether it doesn't work or not, and if it doesn't work you post it. That'S all new, that's different and that's going to be different for us as an industry. So blending technology with human connection is going to be critical. We at this stage we are at this strange but exciting time where we had business that relied very heavily on human interaction but then covet hit. We immediately ramped up our use of technology and we moved all the way to the other side.

100 virtual look at us today. I think most of us would agree that the perfect formula is a nice mix of both so going forward. It'S going to be really exciting to see how brokers blend these two approaches, both with the carriers and with their clients. People still need and want to be connected in person, and we saw that at our conferences that we held in the summer and the fall with very strict cobit protocols. But those in-person meetings will likely be less frequent.

And so how can we use technology to support those relationships? The meetings have changed a lot and they've become more sort of meaty in some ways, more substantive, because there's less of them, and it means that the some of the chit chat doesn't happen. The same way. How can we create these touch points, so our clients are reminded that we're working for them year round, not just during renewal. That's clearly what's happening and then there's the data piece.

If we're collecting a lot of information from our clients and there's a lot of information out there to buy, there's going to be expect us to know more about them. Think about today. What how you approach things! You expect someone to know what you want and how much you want it, that your your expectations and that's what brokers are anticipating that they're going to have to we're going to have to know more about our clients and what their businesses are like and how they're Changing so we can mitigate the risk and we can see the bigger picture. You need to build an a team to deliver on all these pieces, which brings us to our talent issue, see i'm covering a lot of ground here, but talent's, the big one.

Obviously it's just the firms, and we've been talking about talent for a number of years, and talent has been at one point. We said well we're going to need more financially oriented people now we're going to really need the talent thing is really about understanding the people that we're bringing in and making sure that they understand our clients and so they're going to become more specific, while our industry Isn'T being impacted by the great resignation at the same level as some other industries we're facing an uphill battle when it comes to recruiting young and diverse talent? This was an issue before the pandemic and it's even a greater issue. Now the council publishes a quarterly pnc market survey and it's last quarter of 2021 recruiting and developing talent was the number one challenge top challenge of among our firms. What we're hearing from our members is that they have to reach further and deeper for good talent and in many way cases that means recruiting professionals from outside our industry.

They're fine with training. Folks, with that, don't have insurance acumen, but have foundational skills and experience needed for their specific roles, but that creates a cultural shift and you need industry specific training to get these folks up to speed at a rapid pace. We'Ve been hearing from our members and for some time that a gap existed in training and development options for up-and-coming brokers. We felt it was an opportunity to build something brand new just for brokers, so we created the new professional designation apri and that program earned you a designation that the program that is developed to earn you that designation is the insurance professional school we've created it in Partnership with the university of georgia and the institutes and the whole goal is to shorten the learning curve for people who are new to the industry, so they can be effective and more quickly with their firms and clients. Industry, specific training is just one of the examples of how we can support that recruitment and onboarding process.

I've been in this industry for a long time and i think for brokers. Our talent crisis is more of a marketing crisis. This is an industry that allows the world to dream big and take risks. We haven't ever marketed ourselves in that way, so that's an opportunity going forward and one that i'm excited about. Finally, i want to talk about the social contract.

I believe we're all facing a new social contract between employers and employees. Of course, once we get the right people, we have to worry about keeping them and that's where a lot of leaders get stuck, because things are different now competitive salaries and benefits simply aren't enough, especially in an environment where you're not even bound by geography. You can work remotely from anywhere research has shown that it costs businesses between one and a half to twice the annual salary of an employee if they leave, and we know that the two of the main reasons people leave an organization is because they feel like their Career path is stalled or they're not being given growth opportunities. You know it's funny um. I i used to work with a lot of people who would think that if you weren't in the office, you can't possibly be working well.

I can assure you that i have a team here that has worked really hard and worked virtually and produced an incredible amount of material uh during a period of the pandemic. So i'm i'm over that that that feeling - and i think many of us in this industry have learned from that as leaders, we often put conversations about development and career paths on the back burner in favor of more pressing priorities, or we make an assumption that our Employees know how much we value them. That'S just not the case. You have to say it over and over again, but the talent development piece can't be overlooked, particularly as our current leaders start to age out of the industry. It'S not enough to just recruit young talent.

We all also have to prepare the talent. We have to be the leaders of the future. We have to talk to them. We have to interact with them, we have to mentor them, it's really important, you know. Finally, i want, i know pete's going to talk a lot about technology in a minute, but i just want to make a couple of points.

Let me start by saying that i'm not a tech expert. Far from it, i have a lot of really smart folks. In my staff, who are in charge of that, but where i do have a lot of experience is taking risks and trying out new things and i've seen these situations where really good ideas failed, because the right people were weren't engaged in the process. We have insurance professionals, who've been in our organizations in this industry for decades, but there's they've seen a lot of change and there's a certain element of fear when it comes to technology, replacing them or making their roles obsolete. But these same people are the ones with the institutional knowledge, that's absolutely crucial to the success of these projects.

If a solution isn't properly vetted, your team feel can feel like this is something that is being foisted upon them versus something that we make their lives easier. So don't rush, you absolutely need to do the pre-work, but remember the other thing. That'S really important to remember is this is about clients and that you understand what they want in terms of taste. So talk to your teams, vet. The solutions explain what this new technology is is going to do and and so that, when you're ready to pull the trigger on the new investment, your people are excited and ready to jump in.

Sometimes technology can be visible to customers or it might be about tools that support employees. This is obviously making your efficient your more organization, much more efficient, it's also about where you're going to have the greatest impact. I'M sure i'm not unique in this, but believe that there's more art than science in what our members do. So, i think the most impactful investment for brokers are those that are argument augment i'm sorry or support, not replace the broker client relationship. You know that's just critical, i mean it's it's about doing what you do better and more effectively and more impactfully.

Finally, you know i think um we have to. We have to we're going to make investments. We'Ve got to test those investments. The special sauce here is about understanding your client and understanding their business and where it's going so with that, i'm gon na i'm gon na pass this over to pete, and let him give you some real words of wisdom from somebody who's who's on the side of The business that that is really changing pretty dramatically like ours is and uh so pete. Take it away.

It's yours great thanks ken and hi everybody from uh beautiful, downtown hartford, where uh today it's about 11 degrees, i think so winter is well set in here in hartford connecticut. You know when, when looking to answer the question of how we will thrive in 2022, i like to rather think of it in terms of how do we collectively manage engagement in our in our environment and in that regard, there's so many subjects that we could go Deep on today, engagement is shaped by what we call forces of change, things that are affecting our businesses and our careers and our lives. Today ken definitely touched on a few of those. So let's explore a little bit more uh on these risks and opportunities. You know we could talk about engagement and forces of change within the context of the access economy, mobile empowered customers, agents and employees.

Some of the more interesting and perhaps unusual ones that i've learned of uh recently are people who are are owning and and buying physical assets to monetize them in surprisingly new ways, and of course we all know about lyft and uber and vrbo and and airbnb. But people are now sharing their cars through companies like turo and get around and they're even renting usage of their backyard swimming pools, using an app called swimply, there's so much to consider in the gig economy and with the gig worker. And these are just the new and emerging risks that create both threats and opportunities and solutions for sound advice provided by agents, brokers and carriers. We could talk about engagement in terms of continue of the continued robust m a market ken said there were over 1100 transactions. That happened just in 2021 alone.

Now, what does that mean for our businesses and how do we keep up with those changes? That'S a big big question today. We could also talk about engagement within the context of broad societal trends. Things that, like ken said, might have happened anyway, but they're hyper accelerated in this covet world. For example, we've seen younger people get married or otherwise settle down later.

In life than prior generations, we've seen a delay of purchase of assets like houses and cars and life insurance and everything that goes with those delays well into their mid and late 30s, and while housing purchases vastly increased in the last couple of years. The challenge now is lack of inventory and escalated prices, and what is what's the impact of all that on our business and how do we protect emerging asset purchases, crazy things like e-bikes for the local for the micro mobile crowd, we are increasingly multicultural, aging is redefined. Are we prepared to engage with buyers in new and effective ways? Maybe not? We could talk about demographic shifts, it's no secret that southern tier and western interior states are experiencing unbelievable population growth, and some of that is fueling.

Our challenge to ensure and service customers in states where there are significant risks of hurricane and flood and tornado and fire, and while the move to urban centers was a trend say the last decade or maybe two is it still in the pandemic or post-pandemic world? It seems that suburbs are especially attractive today for reasons of safety and well-being, and these are two core life principles of today's millennials and gen ziers that are increasingly being active in the marketplace and spending a lot of money in those places. And, what's that trend going to be post pandemic, another one is climate change, we're reading an increase in the frequency and record number of events causing aggregated losses in excess of a billion dollars? What'S our response there as an industry and, of course, uh? Lastly, the evolving customer we're we're all looking for convenience, we're looking for speed, we're looking for choice and we're looking for fulfillment and more and more believe it or not we're looking for tailored solutions, while all that's going on something that's very unique, uh built just for Them and just for us so while all those are really really interesting subjects, and we could talk about more about those in a future date, what i'd like to do for the next couple of minutes is to pick up on two of the themes that ken shared With us, talent and technology, because there are so both of these are so so essential to our businesses and they're incredibly intertwined engagement between our colleagues, our customers and our connections between agent and carrier and how technology is radically changing how we communicate and what our expectations Are of each other, like ken said, i too have been in the business a long time, i think of them in terms of art and science.

Maybe left brain right brain if you believe in that, and that's one of the beauties of our business that i hope never changes at travelers. We spend a great deal of energy over the last couple of years, unpacking and better understanding the trade or the life cycle of an account and all the components of that transaction. We'Ve set an ambitious uh number of priorities and investments across our businesses that will meaningfully transform how we work - and, i know you're, probably doing the same thing in your businesses. What we all want out of these efforts is for you and us to spend less of our time on the paper shuffle and be able to free up that time, to provide more consultative services to customers and prospects, and to do what you do best be the Trusted advisor and to do you know, have what we do best, which is evaluating risk looking for creative solutions and to even better serve you and our customers. We have the opportunity today to transform how we conduct business.

We have technology that has only come to the fore in the last couple of years and we must simply put our shoulder to the task. Our customers are demanding it and they will benefit greatly from our efforts and you and we and all our work colleagues will have more rewarding experiences that will attract great talent. Okay. So, let's get a little more specific over the last couple of years, travelers invited many in agents and customers to come to hartford to share with us their experiences. Perhaps many of you on this call today joined us.

What we wanted to know was specifically what it takes to transact business on your and our customers end from the onboarding of a new producer or an acquired agency, all the way to the binder for commercial lines. Uh commercial accounts, multi-line middle market size account, which is what we were mostly focusing on at that time. We identified five broad steps in the transaction and they're here the prospecting step, the intake, the triage and enrichment, the quote, and then the service, or you may think of it as fulfillment. And while it's five big steps, it's literally, as you know, hundreds and hundreds of little steps within those and due to the complexity of many deals, it isn't always a consistent process. So no surprise to any of you on this call that are in the business.

90. 95, some odd percent of our transactions are done via email and they're done, with spreadsheets and they're done, with pdfs and applications and so forth. On our end, account clearing alone can take 20 steps, and while we get the job done through hard work, what we call here brute force basically of our trained and experienced people it can take up to six weeks, maybe even longer, to transact a deal. Boeing assembles a 737 faster than we can put together a deal generally in this business, a middle market deal, and we need to do better. We need to get that under a week to meet the growing expectations of our customers and, frankly, ourselves, so travelers we're investing.

Well, over a billion dollars annually on technology, great work continues to be done in the digitization of personalized and small commercial spaces, and those learnings are fueling. The re-engineering and digitizing of the larger commercial lines trades relate leveraging cloud technology, artificial intelligence and everything from automation to deep learning and we're tapping into new data sources, and so under each one of these chevrons. We'Ve identified pain points along the way and we're working on ways to know you and our customers and our prospects better. Even before the transaction is started. It'S incredible to to us.

You know, oftentimes, we frisk a customer for information uh that we should have already elsewhere. A customer that maybe we've had for five or ten years, we're frisking them for information, and that needs to stop we're seeking ways to digitally ingest submissions. We need to build a big catrice mix. All of us do. We need to be able to still ingest data in the hard copy form, but to do so with technology that can actually scrape the data off of like pdf forms and we've we've worked on that here and on the other end of the scale we're building apis.

So machines can talk to monitor, seamlessly and to do so agnostically one big learning for us over the last few years is we know firms and we know people need to work in their own familiar environments for an agent and their own account management systems. They need to continue down those paths, things that are familiar to them. We simply need to make the bridges between these systems work better, and i know it sounds easy. We all know that's really hard work, but it's hard work that we have to do. We also want you to know our appetite for a risk much earlier to stand up, deals quicker to our underwriters, who can make fast go go decisions for you.

We know it drives you crazy. If we sit on a deal for three weeks and then tell you we're not interested, we need, and we owe you an answer - a lot quicker and we continue to invest in advanced tools for claims administration like drones and satellite, imaging and and ai, and those those Just devastating fires that happened in colorado uh earlier this year, we use that technology and the results were incredible. So i'll wrap up here by highlighting these five bullets on this last slide, continue to innovate, innovate and innovate, innovate and unpack and understand the entire spectrum of the process you need to improve. This is the agile environment and i think this third one's the key one need to hire or partner with great technologists. To help build your core.

I could name hundreds that we've engaged with, but i'd risk missing. Some and i'd probably offend others. You know many of them already if you're in this industry and read any of the journals and also engage with great industry, accelerators that have propped up over the past couple of years. They'Re doing really really really interesting work and again i could name them, but i'd probably offend a few that i missed and finally develop everything you do with an outside in view not the other way around you'll be rewarded for doing so. So while all this sounds like science and technology, it really isn't it's.

It's there's incredible need for art in this business and i'd suggest that we need more of it and i think that's ken's point too: we need to innovate to rapidly changing needs and the wants and desires of our customers. We need to do this to attract talent. We need to do this by digitizing the trade wherever possible, and this will relieve the incredible uh burden work that our our customer service, reps and client managers account executives. Producers, customers, whatever relieve them of some of this maddening work and will give us all a more meaningful and higher value interactions. This is what we're working towards, but ken i've been in the business a long time nearly 40 years and honestly, i couldn't be more excited about the opportunities and possibilities today and you know, while we went through this pretty fast and a lot of subjects, i encourage You you, if you have any questions on any of this, find me i'm glad to talk with you thanks john uh, with that i'll, throw it back to you, okay.

Well, that was just terrific, both pete and ken. Thank you. So much for kind of all your thoughts on how it's working and ken in particular, i like that you uh. You said that you know you were a true believer that people had to be in the office to really be productive and your mind and as well as a lot of other people's minds. I'M sure in this industry got changed pretty quickly when um productivity is up and people are just leaning into their.

You know to their jobs, to you know, at home and and and elsewhere, it's uh. It'S remarkable, i think, and i i appreciate the fact that you uh you put yourself in a different camp now than you were earlier, so we have a lot to talk about and we want to get to all your questions. So please drop those questions in the q, a feature at the bottom of the screen there just type away and we'll try to get to as many as we can. But first we want to ask our audience a question so we're going to turn the tables on you for a minute and we're going to do a polling question. So the first polling question uh and then just simply click uh, your uh, your answer here.

How prepared do you think your agency, brokerage or firm is for dealing with changes around the preferred customer experience, so the customer experience of amazon or any other doordash that you get um all your goods and services? You know immediately and it's a frictionless transaction by the customer. So how do you think your agency is doing with changes around preferred customer experience? So it looks like about 70 percent of the audience right now, we're all just voting here, but the results are coming in and it looks to be about 70 are saying: they're somewhat prepared, uh, we got 12 percent, saying they're not prepared at all. So we want to talk to you folks, there's 12 percent uh.

We have a pretty confident number of 21 percent said they're very prepared around changes in the customer. Uh experience, so that's really encouraging 21 pete. Would you have guessed that that people are feeling confident? No, no that's a bit of a surprise yeah yeah! Well, that's great!

That's a really optimistic note for us to start this conversation on okay. Next question for the audience: um we're gon na get to question two. What percentage of total employees does your agency or firm expect to hire in 2022? What percentage of total employees are you going to hire in 2022? This is assuming um right now, it's january, who knows, but uh you're, currently planning on hiring give it a second to come in.

So the results, i'm reading uh look to be a little surprising here, uh, 20 or greater that numbers come in at 11. So one-fifth of your workforce, you intend to hire uh, that's a lot of people, uh eleven percent, thirty percent of you say ten percent uh or more forty percent are saying five percent and uh 20 percent said no one they're planning to hire no one. So ken, what do you make of these results in terms of their hiring plans? Right now, so john, that tracks, with what we've been reading? Um as i listen to people who are giving us their plans for the year um there's an enormous amount of hiring going on.

There always has been uh and it's one of the motivations we did in creating the apri and the insurance professional school was to sort of you know, gravitate towards getting those people on board and making investments in it. Because one of the things that we've all learned is that, in this talent war, one of the things that employees in that whole employee relationship, it's really important - is not only that they care about you that you're empathetic towards them, but you're also willing to make an Investment i keep hearing from some firms. The middle market firms is that they have a they're limited on the amount of service. They can provide a client. But if you, if you focus in on some of the aggregation strategies, it's been about building out a service component and so that so i'm not surprised pete your comments on some of these results on employees and attracting and retaining talent and investing in people.

What are we doing at travelers and what best practices are you reading in some of the agencies that you deal with all the time? Yeah i mean when, when we go out and talk to agents, i i guess i am a little surprised about those numbers, because when we go out and speak with agents - and we have been out there uh over the last few months, every one of them talks About hiring producers and they're hiring they're looking for producers, because they're looking for people that are going to generate new business and new connections and so uh. I don't think we've been to one meeting where somebody didn't say to me say to us: hey if you know any of anybody on the street, can you can you please let us know so that number surprised, but you know there's. This is a big audience and there's a lot of different needs and it comes down to individuals and and individual firms. With respect to travelers i mean listen, it's you know.

I've been the beneficiary of working here for for 37 years. It'S been a great great career. This company and its value system, and and all that has just allowed me to to you, know, thrive and be comfortable in in my role, and i and i think, um. There'S a lot of companies like us out there that that people can go to and really have a very rewarding career. You know i do a lot of a lot of um.

You know talks to young people and some of the non-profits that i work with in colleges and university thing and one of my standard questions to a group when i get up in front. I say: hey name me, one job, that that doesn't apply to insurance or is not a job within an insurance company and somebody invariably say well a policeman. I said. Well, that's not true. We hire a lot of policemen.

Investigators for claims go well. How about a fireman? Well, actually we have a fire lab, as do other companies, so we hire people to set fires and to see how those fires you know burn and how we can control those, and you know they'll get into well. You know how about a weather man? Well, we, you know, we have other people, there's just a tremendous number of opportunities in companies today and you know again, i i think for data scientists and for technologists and things like that.

I think it's a really cool career. There'S a ton of capital in this business there's a ton of risk in this business and we need really really smart people to sort all that out and to do the things that ken and i talked about and is the reason that producers you you hear about. Producers and what i'm hearing about is employees and the reason is, is not only does do the carriers need climate people and security, people,  etc and claims people, but so do the brokers, because brokers have now built out services around those areas and understanding of business And if you really think about it, one of the exciting parts of this business, i think, is the fact that it doesn't matter what you dream about. What startup we're talking about. Everybody needs insurance.

You  want to protect the asset if you're building an asset you want to protect it. So the industry allows the world to dream and that's an exciting component to it, and you don't need to be a producer that sells necessarily you can be a claims person. You can be a technologist, you can be a climate person. That'S what's really exciting about this. I think it's it's an industry that is so comprehensive that there isn't there isn't a job you're, that's a great question: there isn't a job out there that this industry doesn't have some connection to um and that's really exciting.

I agree what wonderful uh! That'S a wonderful conversation on employees um, so so i want to shift a little bit because when i get to the heart of the matter here, we're talking about the changing distribution, landscape and a lot of questions have come in. People want to thrive in that changing distribution, landscape but pete. First to you. What are the really the biggest challenges or what may be coming and we're not reading it to disrupt our industry, um, obviously cove in the last couple of years, but uh.

What? What is the biggest challenge right now? Do you see to this changing distribution, landscape, wow um? You know, i don't think, there's there's really one junk um there there. You know one of the things that i that i'm always reminded of with with a mentor of mine.

He always said: read the trend lines, not the headlines and basically, what he was saying is, you know, don't overreact, the headlines that are on the page think about what it is that those headlines are leading towards in in whatever subject you know whether you're talking about You know middle east politics or whether you're talking about the ukraine today. Think of what the trend lines are. Don'T worry so much about. You know that episodic event. So i see that this this march towards uh this digital digitization of a hard time with that word uh, that is, is just been accelerated tremendously, but we can't we can't leave behind those that aren't ready for that.

I think i think, as an industry, we need to do our best to bring everybody along uh. There are companies and agencies that won't be able to invest in this technology, and they, just you know, shouldn't go to the dustbin. They serve a purpose for their communities and for their workers and so forth, and we need to figure out a way to support them all the way up to the to the big guys. And so i i i worry a little bit about some dis disenfranchising in the business uh. Maybe that's the natural course of competition, but um, you know, that's that's one thing i mean i could talk about a lot of things.

Cyber you can we already. You know. Probably killed the talent thing, but but i do dismiss the notion of disruption. I think you know if i'm going to steal something from one of my one of my co-workers that i loved you know if you looked uh, maybe five years ago in the press, the insurance press, it was all about disruptors. They'Re gon na people are gon na.

Come in and disrupt our business disrupt, disrupt and and what ended up happening was they didn't a lot of them didn't realize what how complicated the business was, how regulated it was, how much capital was required of the business right. So then, a lot of these companies pivoted to to technology - and this this is, you know again, not my line, somebody else's line, i said well, some of these technologies came out with with uh. You know a solution for uh making the doorbell talk to the toaster you're like, like you know, that's really neat technology, but what did that do for us today? The last couple of years we now have these technology companies that are that are focusing on one thing. Maybe the application process - maybe the you - know the drone process, maybe the satellite process.

Maybe you know the scraping of data off the hard forms and those are the those are the ones that we need to encourage and to plug and play into our systems. So i know that i probably went a little off. That's great, let me let me hop in here because pete and you and i um can probably disagree sometimes, and i i don't like to destinately disagree with you, but i disagree with you completely. I think this industry - i i don't think the players that came in the text, the fintech players that came into the business, were focused on disruption as much. I wasn't worried about that disruption.

What i'm worried about is, i think, clients are different today. There'S been all this discussion about all this data being sold. Okay, so that's okay buy all the data you want, and i think we get to this point where you know a broker shows up with a carrier and all of a sudden they have the amount of data that they believe is necessary for you to underwrite, and You look at it and you don't need much anyway. You can buy most of it. You could, i mean, think about property insurance.

At this point, i i'm i kind of i've gone off on this tangent before, where you're in a building i could. I could probably in any building find out when the renovation was, who did the renovation who's in the who's in the space, when the lease was signed, how the building what the material was constructed with? What'S the weather like around it, i mean the amount of data that is necessary and clients expect us to know that now and that's if there's a secret sauce, that's the secret sauce. It'S taking that information in and being able to translate it into something that makes you into a business all right, i'm going to jump in here, because we have a lot of audience questions again, so we need to move on. So you know, due to the tax rate changes.

Uh 2021 proved to be a really red hot m, a market, a lot of activities, as you said, do you anticipate that this is going to continue in 2022 or you think there'll be a slowdown can't continue. I i think it'll continue. I i don't think we know what's going to happen uh and but right now it's appearing like we aren't going to see any significant tax changes, but that's as of today, who knows what tomorrow brings pete. Do you have a thought there? I agree, i agree, i mean you know it's a thousand thousand last year 1100 last year, i think we'll see something similar this year.

Uh there are a lot of reasons for selling and not all monetary. Some of them are perpetuation and so forth. So i think a lot of those reasons still stand. Okay, another question coming in uh. This is interesting.

I'm a youngish agent, 36 and i've been licensed for a little over two years. I still have a lot to learn on the insurance side. I understand and love technology, however, but most of the people in my agency are old school. They don't like change. They don't want to hear about technology, any tips on getting them on board, with the digital speed of where this industry is going.

That's a great question. Wow, i don't know you can have that question pete, because i wow i like that a lot, maybe uh, maybe maybe uh. Whoever asked that question can can give me a call. We can talk about it a little bit deeper. That'S that's a challenge!

Um! You know. I mean you could put articles in front of people and and so forth. Uh you know, maybe even you know, take a copy of this webinar and and send it on to them. But but forces of change are are coming and you don't want to be overrun by them and, and you possibly could you know, technology doesn't necessarily mean a vast change.

In fact, i think ken and i you know violently agree that what technology is going to do is allow us to do what we do better. And so, if you have an old agency, you know they're, probably there and successful, and they hired you uh, because they've been a successful agent for a long time and they've done that, because they're they're good in their community they're good with relationships and sale and all That sort of stuff - and i i think i think that you know if you sit them down and talk to them about their frustrations with certain things whether a carrier takes forever to get back to them, or you know why can't we self create certs, or you Know get policies electronically or whatever tell them that there's a solution for that and here's here's how and that's 30 seconds, but i i'd love to chat with you more on whoever asked that question yeah. Otherwise you you're you're going to end up in the m a category i mean that's the other option: um either they they understand the benefit of technology or they end up deciding that they're, just not in that business anymore. Okay, maybe um. Another question coming in here: i'm not sure who wants to handle this one, but i know i hear a lot more.

I want to hear a lot more on the market. Are we looking at a harder market premium increases over the next couple of years? Understand? Cyber has definitely changed and higher deductibles and higher premiums there. But what do you see overall with the commercial lines market?

Well, i can tell you that i can't talk forward. I can talk backwards because i can because we have our survey um we've seen it. It is starting to soften up and that's what we've seen in the numbers, and i think that that's an issue of data there's more data out there and as underwriters, become better at underwriting. Their pricing becomes better. It'S that simple, yeah.

Okay, i mean for me. Listen, we really don't forecast the market here at travelers, but you know it. It kind of will be what it will be, and you know there's a lot of a lot of competition out there for sure uh and you know, there's all sorts of drivers, the things that we talked about uh today. There'S the weather, there's there's uh, you know social inflation, there's still very low investment returns and so forth. So you know none of those things have changed uh in 2022, so you know take that to where you think that might go.

Okay,  this one's for ken. What ways are brokers reaching decision makers today, traditional methods like phone email, cold, calls or newer methods like tick, tock and social media. It'S a good question. Well, i i think i think, all of the above. It'S not just the relationships anymore um.

It's i mean i. I will i could, let me just tell a quick story, so i had a relationship with a real estate commercial, real estate broker that i had had for a long time and a guy that worked for him many years ago, who he trained, came to see me And i i saw him because i know who he is and he got in there, but he gave me gave me a slew of data that i had never seen before. It was so compelling it made me move and i picked up the phone and i called my old broker and i said, hey bill. Sorry, i'm moving this and here's. Why - and he completely understood why now i'm just suggesting that that there's more to this story than meets the eye, all righty, uh pete, this one is for you: are there any specific patterns that you notice that successful agencies are doing to market themselves by using new Methods to generate new business and what are those new methods or platforms uh that they're using this is like uh stump the stump the author uh yeah.

That's that's a really challenging question i mean. Are you reading agencies use use? Facebook, for example? Maybe that's more personal lines, yeah. I think i think they are um.

You know. Let me let me just maybe give you the side of the carrier, because we kind of face the same thing on the carrier side right. So you know we have underwriters and account executives and business development directors that are also challenged by you, know: new business and new connections and so forth and, and it's been fun for me to read uh and you know i'll just call them. You know younger people. Just because they're younger than me, you know 30 and 40 year olds, using new methods to to connect with people.

You know whether they're digital or or you know we used to do stuff on the golf course and today they're going out axe throwing you know, you know, you know that kind of that's a good point. There. You go, that's a new method. Yeah i mean i just encourage people to break through that noise, that you can't do it you can you can you can do it but but pete, and i i totally support what you're saying i. I would just say that it's all about the same thing.

It's about recommendations, it's about personal relationships. Social media is nothing more than i read something here and it catches my attention and i tell somebody else, look at how we all read tv. We all you know it's all done by social media now um, and so i i think you know facebook anything that works any relationships. Anything we see it. We see a lot more people being involved with local employers like construction people or whatever it's just it's.

It's all it's all changing very rapidly. It'S where people are yeah and john. I just had one thing: listen, a lot of this. A lot of things are coming in electronically, still, email and all that sort of stuff, but pick up the phone. I guess i would say if, if you're sending in a submission, i i love to hear from the the csr account executive broker, whatever i want to hear.

What's behind that that submission that you're sending think about think about it from the concept of when was the last time you got a thank you note by a handwritten. Thank you note. You notice those those stand out. Mail stands out these days. No good point!

You know and phone calls too right phone calls. I mean talk, it don't text it right, um. You know you'd much rather hear from your kids than you know, on the phone than the text and same way, but a text or an email, a a text or a phone call or a note is more important. It carries more weight and it means you're communicating something an email. Just i don't know, i'm not a big fan of email, but that's because i get so many of them, but well listen, good good advice.

I think for all of us and and our time is up and what a great discussion uh i want to thank you, ken and pete, for your time today, uh we will have a replay uh sent out to everyone of this great session, and so again thank You i really appreciate you joining thanks. Um and also uh join me next wednesday, next wednesday uh for a conversation with johnson and johnson cfo joe wolk uh, the largest health care company in the world, and he's going to join us talking about lots of different things that you're going to want to hear About and then february 16th i have a good friend and president of middlemarket here, travelers scott higgins, he's going to talk about. What'S going on in the middle market and changing landscape there and then uh renowned attorney, uh ken feinberg uh special master of the 9 11 uh settlement uh is going to talk with us about what's going on in his world and we're going to be giving away His book, who gets what so register for that and get a complimentary copy of his book uh march, 2nd we're going to talk about renewable energy with travelers, eileen, kaufman, so register for any of these programs on our website. Travelersinstitute.Org connect with me on linkedin.

I always post lots of invitations there and uh. Listen it's great to be with everyone. Thank you. So much for joining us uh stay safe,

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