This is a synopsis of the council's report hard trends for technology and consumers. The full report may be viewed by accessing the ACT web site through www.independentagent.com.

Trend: Technology – Computing Power and Storage

Enhancements in technology will continue to provide significant increases in computing power and storage capability.

Business Trend:

Virtually all communication, data exchange, and inquiry will be in “real time.”

The ease of entry will encourage new competition from both traditional and non-traditional sources.

Increasingly, the buying process (research – sale) will start and often finish on the Internet.

Sales and servicing will be processed 24/7 via the device of the users choice: desktop, laptop, TV, cell phone, iPOD, PDA, etc.

Customers' expectations will be for full service from anywhere at any time from any device they have in hand, seamlessly, with and without the involvement of a human being.

Customers will expect to access account information from all service providers online and will become comfortable with performing increasingly complex tasks in a self-service mode.

The next generation of web sites will marry voice, video, and graphics.

Implications for Agents:

New competition from groups like warehouse stores and affinity organizations will challenge you for the same customers.

Is the one workflow for multiple devices?

Multiple portable devices will need to integrate with the agency management system and comparative raters.

Agents need to learn how to take advantage of the power of the individual communications devices. E.g., do a quote on an iPOD, teleconference with a customer via TV, etc.

Security will become a more complex issue:

Secure e-mail needs to fit agency workflow.

Portable devices need to be secured as storage devices, as transmission devices, and from viruses of all types.

Support for transactions and service will need to be available 24/7.

Agents will have to build their brand on the Internet as consumers increasingly go to the Internet first for their information and service.

Agents will need to be able to provide customers with real-time service on the Internet, as their competitors will do.

Trend: Technology – Information Availability and Access

We will see ubiquitous availability of, and access to, information, regardless of location, through superior availability of broadband and wireless connectivity.

Business Trend:

Geographic boundaries will lose relevance and in a practical sense disappear.

Telecommuting for work will become more prevalent. (This will be encouraged as a result of environmental and conservation issues.)

We will see the introduction of “Intelligent Agents” – Complete customer information that will be used by consumers to search the web for relevant products and services.

The ubiquity of “search” will change the way we advertise/market our products and services.

The ability to use VoIP as a business telecom network will support telecommuting.

Implications for Agents:

Need to accommodate the reach to variety of multi-cultural and ethnic groups. How will you deal with multi-language self-servicing on your web site?

Telecommuting for work will become more prevalent.

Agency web portals will provide an invisible pass-through access for the customer to the carrier sites.

We will be able to find out more about people and organizations from data stored in “cyberspace” and on third-party databases. What do you use? How do you use it?

Agents will be able to track individuals' behavior on their web sites. How can agents use this tool to provide customized services?

With a phone number, one can pull name and address, vehicles in household, employer, family members, current policy, MVR, loss history, and what else? This provides tremendous efficiencies and benefits reducing data collection and keying requirements. But how do you ethically use this data? How do you protect individual privacy?

Search engines – on the web and on the desktop – will become more sophisticated. What data can you find that helps you prospect?

Agents will need to market themselves using search engines, because this is where consumers and businesses will look first for insurance information.

Using intelligent agents, one can define a profile that will search and automatically return leads that match not just what you type, but what you want. Can one use that for prospecting? Underwriting?

What are the moral implications of this power/access?

Agencies will need to tie their computer networks, phones, etc., together for anywhere, anytime support.

Trend: Technology – Multiple Devices

Widespread proliferation and merging of communications devices.

Business Trend:

Business will be done via cell phone, iPOD, PDA, instant messaging, laptops, notebooks, wireless devices, TV as the PC monitor, etc.

Implications for Agents:

Agents need to understand the revolution occurring in portable technology, and how they can use it to improve their communications, responsiveness, and service.

Trend: Technology – Biometrics and Product/Property Tracking

Biometrics will become more commonplace as a way of identification and security. Chips and geospatial tracking will be used to monitor and track products and property.

Business Trend:

Identification and processing timeframes will be streamlined and minimized as a result of electronic stamping.

Implications for Agents:

Will smart tags in cars and other high valued items change the placement and/or rating and claims of auto insurance?

How will you convince customers of the merits relative to privacy? How do you manage insured's concerns when change in carrier?

What are the implications of smart tags imbedded in customers cars?

What is the extent of the legal and security concerns? Will we be tracking individual behavior?

Trend: Demographic – Baby Boomers

Many Baby Boomers will reach traditional retirement age, but will continue with active lifestyles and often re-engage with new work, including part-time positions, in-home businesses, or volunteer pursuits.

Implications for Agents:

Boomers will continue to be important insurance consumers and business owners.

Boomers need financial services advice and products.

As Boomers re-engage with new part-time work, agents will have opportunities to hire them to perform sales and service roles in an environment where recruitment remains difficult.

Trend: Demographic – Diversity

The U.S. will continue to have a more ethnically diverse population, along with many single- parent and other non-traditional households. In traditional households, both spouses working will continue to be the norm, and women will increasingly hold managerial positions.

Implications for Agents:

Agents will need to use technology advances to meet the time and logistical constraints of single parents, busy clients, and customers whose ethnicity requires unique handling during interaction.

The Independent Agency System should continue to seek ways to a) employ and b) market to a diverse population.

Agents will need to customize services and communications to the needs and preferences of particular customers.

Trend: Demographic – Next Generations

Generation X and Y will be in their prime child-rearing years, owning homes, and running businesses. They will have needs similar to those that their parents had at this stage of their lives. But they are likely to have some different expectations from their parents, which service providers will have to ascertain and deliver. These consumers have grown up with computers, and computers are second nature to them.

Implications for Agents:

Agencies should develop the capability to keep track of, and deliver on, any different communications and service preferences their customers have. Boomers will expect their agents to be full participants in the networked world, enabling them to communicate with, receive information from, and transact business with their agents electronically.

Agencies that use technology fully and have efficient workflows will be in the best position to attract Generation X and Y employees, and these employees will be a great resource in fashioning messages and services that resonate with these upcoming generations of customers.

Trend: Demographic – Global Economy

Local businesses will continue to expand overseas, buying and selling across the globe, and setting up remote offices internationally with U.S. and foreign employees. Personal lines customers are buying residences internationally or working internationally.

Implications for Agents:

Agents will need expertise in identifying and managing the international risks presented by their customers, as well as the markets that can insure these risks.

Agents will need the database to track this international information and coverages.

Trend: Buyer Behavior – Time

Time will continue to be in short supply for most consumers and businesses.

Implications for Agents:

Agencies must adapt to customers who are shaped by their own busy schedules, with both spouses working in many cases, juggling balls in their own careers, etc. Agents should offer options to do business when it is convenient for their clients, in the most efficient way possible.

Agencies must find – and communicate – ways to save their customers' time, not cost them time.

Agents should explore how they might use automated “intelligent agents” to search out the best choices for customers in the shortest amount of time.

The ACORD electronic standards will be more widely implemented by carriers and vendors, greatly facilitating the real-time sharing of data between more carriers and agencies, for more lines of business and types of transactions.

Trend: Buyer Behavior – Information

Consumers and businesses will face an increasing array of choices and greater complexity. The Internet will offer access to more information relating to insurance and risk management.

Implications for Agents:

Agencies will be expected to be knowledgeable advisors.

Agencies must focus on new training needs to help employees become trusted advisors. In order for their staffs to take on this new role, however, their traditional processing functions need to be automated to the highest degree possible.

The agency's brand, web site, etc. will need to reflect a higher degree of professionalism.

Agencies increasingly will specialize to provide value-added advice and services to their particular sectors.

Agents will retain more customized data relating to customers' preferences and particular needs.

Trend: Buyer Behavior – Trust

Because of the well-publicized failure of many businesses to deliver on promises to their employees and consumers, many consumers will be skeptical of businesses that approach them. Businesses will have to earn trust in order to build customer loyalty.

Implications for Agents:

Agents are in an excellent position to build trust relationships with these consumers. In spite of all of the technology, human beings still seek relationships with businesses with which they deal. The foundation of all relationships remains trust.

Agents should focus specifically on how they can build the level of trust with their clients.

Agents should review their current communications and procedures with clients to ascertain whether these approaches build client trust or detract from it.

Agents should automate processing functions to the maximum extent possible, so their service personnel can transition into the role of trusted advisor, making value-added contacts that build trust.

Business clients will expect agents to provide services customized to their individual needs and to explain the specific services they provide to justify the fees they earn.

Trend: Insurance Environment – Privacy/Security

Laws and regulations will a.) require businesses to undertake affirmative actions to safeguard customers' private information and to limit its disclosure to third parties, and b.) specify what businesses must do if there is a breach in the security of customers' private information.

Implications for Agents:

Agencies will devote significant attention to policies, procedures, training, and monitoring to protect the privacy and security of their customer data.

Secure e-mail.

Encrypted databases.

Two-Factor Security.

Special attention to risks of portable devices.

Trend: Insurance Environment – Efficiency/Service Delivery

Innovations by competitors will continue to drive heightened efficiency and improved service delivery in the industry.

Implications for Agents:

Drive more efficient ways of doing business and the delivery of enhanced services to compete effectively and to differentiate their agencies from the competition.

Trend: Insurance Environment – Regulation/Litigation

The basic business of insurance – personal and commercial – will continue to be highly impacted by state and federal laws and regulations, as well as by litigation.

Implications for Agents:

These laws will require agencies to implement specific measures to safeguard the privacy of customer information and to respond to their customers when there is a breach of this information.

Policy language and market availability will continue to be impacted by changes of law and litigation.

These forces will require some agencies to provide new consumer disclosures.

Trend: Insurance Environment – Changing Risk

The scope of risk faced by insurers in various lines of insurance will continue to change over time based on natural and man-made causes (e.g. weather, litigation, political pressure, population shifts to the coastline, etc.).

Implications for Agents:

Will raise availability and pricing issues that agents must explain to their customers, coupled with placement and servicing challenges.

Efficient workflows, such as real-time and download will enable agencies to deal with these challenges more efficiently.

Service needs will develop to customize or individualize each insurance package to the customer's specific requirements. This may lead to a Personal Risk Management practice.

Effective disaster plan to ensure agency continuity in the aftermath of a disaster or systems/communications disruption.

The Independent Insurance Agents & Brokers of America (IIABA) is a national alliance of 300,000 business owners and their employees who offer all types of insurance and financial services products. The Agents Council for Technology (ACT) is affiliated with IIABA. It is a partnership of independent agents, companies, technology vendors, user groups, and associations dedicated to enhancing the use of technology and improved workflows within the Independent Agency System. To learn more about ACT, visit www.independentagent.com and click on the Agents Council for Technology tab or contact Jeff Yates, ACT Executive Director at [email protected].