The pandemic accelerated digital transformation across the insurance industry, and agencies quickly learned how customer's digital expectations are changing rapidly. A recent survey of nearly 600 U.S.-based independent agents from Liberty Mutual and Safeco Insurance sought to understand how independent insurance agencies are evolving to meet new expectations. The results, published in the "Rise of the Digital Insurance Agency" report, found that digitally-savvy agencies grow an average of 60% more than their less digital counterparts. Furthermore, 44% of high digital adopters experience annual revenue growth of more than 10% compared to just 29% of low digital adopters that experienced the same. According to the companies, the study's findings come at a crucial time for the independent agent channel, which has had to deal with operational disruptions tied to the pandemic while meeting customer's growing expectations. "Digital is a trend that has been building for decades now, and COVID-19 has simply accelerated the need for transformation," Tyler Asher, president of independent agent distribution at Liberty Mutual and Safeco Insurance, said in a press release. "While we know anecdotally that deeply digital independent agencies generate more leads, operate more efficiently and have happier customers, this research offers a clear picture of the business value digital can provide, which is that high digital adoption leads to faster growth." |

Scoring agencies' digital adoption

This year's report introduces the inaugural Agent for the Future™ Index, which scores agencies on a 10-point scale based on adoption across a range of digital capabilities weighted by complexity. The capabilities analyzed included fundamentals (social media, online quotes), modernizations (self-service portal, live online chat) and innovations (paid social media advertising, video quotes and policy reviews, and AI and chatbots). The Index breaks down data into three groups of agencies: low, medium and high digital adopters. One of the most significant gaps appeared when evaluating how digital adoption contributes to growth. According to the Index, agencies within the low digital adoption group scored an average of 2.76 and grew an average of 7.4% year-over-year. For comparison, high adopters scored an average of 6.76 on the 10-point scale and grew an average of 12% — equating to a more than 60% greater lift in revenue growth for highly digital agencies, said the report. |

Key takeaways

Agents are finding value in digital marketing today more than ever, said the report, which added that more than 80% of high digital adopters plan to increase their digital marketing efforts within the next year. On the other hand, about 27% of low digital adopters have zero digital marketing initiatives in place today, with no plans to change in the future. Unsurprisingly, after the incredible surge in the use of video meetings this past year, 45% of high adopter agencies noted their interest in continuing to leverage video for quotes and policy review post-pandemic. However, despite the success of video during the pandemic, only 9% of low adopters said they plan to use the technology moving forward, revealing an opportunity gap for agencies in this group that don't add revenue-driving technology to their operations. Further findings show that high digital adopters plan to invest in critical areas of the business, such as hiring and continuing education, this year, while low adopters plan to implement digital fundamentals in 2021. "Beyond the digital takeaways, the research findings also tell us that the independent agent channel is stronger and more agile than ever," Asher said. "Independent agents (IAs) were built to evolve, and many are approaching this latest challenge with the same sense of adaptability that has allowed the channel to thrive for more than a century. We at Liberty Mutual and Safeco are here to help IAs push the boundaries of what is possible by offering the resources and actionable advice they need to win with digital." To learn more from the report, click through the slideshow above and join an upcoming free webcast, "The Rise of the Digital Insurance Agency: 3 Award-Winning Agents Share How They Drive Growth with Digital," on April 28 at 2 pm ET. Related: |

• 5 things agents should ask before working with an InsurTech
• How technology can uncover insurance agent opportunities
• IVANS: Agents want greater connectivity from insurers