What concept has all of the following?

Dramatic new property-casualty business potential.

Superior retention.

Near-elimination of payment-related service issues.

No renewal pressures.

Exclusivity.

Prospecting efficiency?

The answer is multi-company, multi-product, worksite-marketed, commercial and personal lines.

For independent agents to fully take advantage of this opportunity, a paradigm shift in the agencys sales approach is required. It is time for well-managed departmental convergence–with agency management directing the various departments the way a conductor manages an orchestra.

Now that independent agents can pursue personal lines accounts through work-site marketing advantageously (with multiple insurance companies and complete control of the program), the merits of the concept are becoming common knowledge.

Employers win because they can offer a valued benefit without expense. Employees win because they gain access to a competitive array of companies with a variety of underwriting appetites. Agencies win because they now can successfully become the exclusive providers of preferred payment terms to entire employee populations.

In the process, agencies can generate significantly greater commission dollars from each commercial relationship. The employers endorsement and assistance with program promotion makes the concept even more powerful.

The key for independent agents interested in this sort of worksite marketing is an electronic billing system that consolidates multi-carrier, multi-product billing into one payroll deduction report. Agents receive full standard commissions and control the process. The employer, meanwhile, has the administrative simplicity of a single program, while being able to offer employees a diverse menu of voluntary employee benefits.

The technology allows for departure from todays worksite marketing environment. Most single-company work-site marketing today is conducted on a mass-marketing basis. The agent mainly plays the role of a “finder” of an employer who is willing to participate. The agent usually receives a commission of only 3-to-5 percent of the p-c business written. Employee enrollment, marketing and policy service is usually the responsibility of the insurance company in this environment.

New technology allows agents to work with their standard commissions and have total control over the entire program. Agents are in a position to determine what group size would be most profitable to their agency. While groups of 25 employees or even less can work well for an agency, new technology can handle any group size without limitation.

Once enrolled as a client, employees are more likely to remain loyal, becoming comfortable with the headache-free payroll deduction.

Independent agents have a great opportunity to increase personal line sales and retention. Worksite marketing of auto, home and other personal insurance products is a well-kept secret. The old way of writing the business, without the agents control, no longer exists. Technology makes it possible for agents to efficiently offer a choice of carriers and products in this lucrative “commercial-personal lines” marketplace.

So what about convergence?

Besides technology, the other key to an agencys success in the pursuit of worksite-marketed sales is recognizing who should be handling what responsibilities.

Although you are going to commercial entities, and ultimately selling personal lines products, the initial sale is a benefit sale. The program implementation is a benefits implementation. The employer is interested in an employee benefit program that will generate significant employee goodwill.

Someone with a benefits background, or someone willing to learn the benefits sales process, ought to be the lead salesperson for your worksite program. If you dont have this skill in-house, strategic relationships for this type of activity are not difficult to establish.

Convergence, in this context, is taking the program sales skills of your benefits people; the contacts and relationships of your commercial department; the personal lines sales and service skills of your personal lines department; the management and leadership skills of your management team; putting them all together and going after this opportunity with a winning strategy.

The football coach uses special teams, offense and defensive squads as the games circumstances dictate. In the same way, each department plays a role during worksite marketing. Independent p-c agencies need to recognize the skill sets of the departments, and deploy them effectively to take advantage of todays opportunities.

Convergence will make your agency a winner.

John W. Macdonald is vice president of Conway, N.H.-based Agency Revenue Tools, LLC. The Web address is www.agencyrevenuetools.com.

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, January 21, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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