Adapting to Thrive: The Future of Independent Insurance Agencies
Independent insurance agencies are facing a period of significant change, and their ability to adapt will determine their future success. Experts in the industry say that strategic investments in technology, data-driven decision-making, and a continued focus on human connection are vital for these agencies to thrive.
Data has become increasingly important for maintaining strong relationships with carriers and fostering growth within agency networks. Steven Pearson, president of ISU Steadfast Insurance Agency Network, highlights the shift toward greater transparency and data utilization. “I think the Insurance Network Alliance has helped educate both less sophisticated agency networks and, by trickling down, agencies themselves, on what are the new table stakes to thrive in the new environment,” Pearson stated.
Carriers are now seeking concrete evidence of performance, which is where data analytics becomes essential. Networks that can leverage data to identify trends, create specialized programs, and offer targeted growth opportunities will be better positioned for success. Pearson recalls, “Don’t give me a promise—show me the money. Show me what you’re actually doing.” This shift underlines the importance of agencies analyzing their own data.
Agency networks distinguish themselves from informal cluster groups by their ability to collect and analyze data comprehensively. Unlike informal clusters that may share basic information, agency networks can provide structured data analysis and a unified voice for their members. This structure allows for collective representation and the development of advantageous programs. According to Pearson, “An agency network has more ability to truly represent the agencies as a group.”
Technology as a Competitive Advantage
Managing extensive relationships while keeping up with the changing demands of the insurance industry requires a focus on data-driven and digital solutions. Investments in technology are playing a critical role in this advancement. Mike Strakhov, senior vice president – agency banking market leader at Westfield Bank, noted the complexity faced by networks. “If you think about it, some networks have thousands of members, work with hundreds of carriers, and serve tens of thousands of insurance customers,” Strakhov said.
Technology, particularly Artificial Intelligence (AI), is becoming a significant disruptive force. Diane Wagner, vice president of strategic planning and education for First Choice MarshBerry Company, emphasizes that AI’s impact is not a gradual shift but rather an immediate transformation. “AI is here. It was here overnight,” she said. However, agencies face challenges in keeping up with these innovations due to resource limitations. INA aims to help by simplifying the evaluation process of new AI driven tools for their members. Wagner states, “If we can create a checklist to take our members through that [analysis], I think it would be a huge, massive benefit, no doubt about it.”
The Future of Insurance Networks
Despite industry consolidation, technological disruption, and market shifts, independent insurance agencies can thrive if they adapt. Pearson believes that agencies’ focus on combining technology with personal customer service provides them with a competitive advantage. He notes, “I think as long as they use technology and are efficient, their personal contact with customers will outweigh all the machines and AI engines trying to predict what customers want.”
Human connection remains a crucial element of the insurance industry. As networks evolve to meet these challenges, INA continues to guide its members, ensuring that they remain competitive and are ready for the future. As Pearson emphasized, “Insurance is critical when you have a loss that could mean losing all your wealth or your home. People don’t want to just click a button—they want someone they trust to be there when it matters most.”
