PIA National CEO declares ‘Today’s agency is not yesterday’s agency’
When you sit on top of one of the largest national trade associations serving independent agents, you see a lot. Mike Becker, CEO and EVP of the National Association of Professional Insurance Agents holds nothing back in this episode.
In this robust, fast-paced conversation, Mike shares his perspective on how agents can thrive in the Modern Insurance Age:
- How agents can keep up with the dizzying pace of change in today’s insurance landscape (and why it’s a non-optional behavior)
- The shift of power to the consumer – and what that means to the agent of today
- Legislative threats, emerging technologies, the changing role of the agency principal… Mike shares his insights on being the proactive insurance agent
If you have time to listen to one conversation about meeting the future head-on—and winning—invest the time on this one… Whether you’re a PIA member or not, Mike shares wisdom that EVERY agent and serious insurance professional should hear.
What are other agents & brokers doing to thrive? What are the biggest trends affecting the retail insurance agent & broker? What are the most important strategies and tactics you need to grow faster? Find out here in the Connected Insurance Podcast, where our hosts discuss the biggest issues affecting the independent insurance agent & broker with the industry’s leading figures.
Michael Jans: So happy to have you. How are you?
Mike Becker: I am wonderful. It’s good to do this for our official third time.
Michael: This is our official third time and I think I will probably spare the details now, and I will maybe introduce the audience to some of those details in the introduction. By the time they’re here, they may have already heard this, but you have been persistent and dogged in your efforts to aid me in getting your voice on this podcast series, so I appreciate that.
Mike: Well, I appreciate the opportunity. It’s always good to talk to you.
Michael: Let’s get right into it. The first thing that I want to ask you to do, Mike, is just give us a little thumbnail bio of how you got to be where you are and what’s your background that led you up to this really important position in the industry?
Mike: Well, don’t hold this against me, but I am a native Washingtonian, never got out of the city. I love this area and with a background in political science, started on Capitol Hill. In a short time, they were looking for a member of Congress. I left in 2004 to work on legislative issues for industry, but it was actually the pharmaceutical industry. In 2007, a little bit on a whim to be honest with you, I saw an ad for PIA, the National Association of Professional Insurance Agents, seeking some legislative help. I threw my name in the hat and the very beginning of 2007, it’s hard to believe it’s been about 12 and a half years, went over to PIA and represented the organization on Capitol Hill and led our legislative efforts for about five years, and about six or seven years ago, became the executive vice-president and CEO of PIA. Let me tell you it’s flown by and it’s been a really incredible ride with some really incredible people or just a great organization.
Michael: In a fairly incredible time in the industry.
Mike: Very much so. The clip that I feel like it’s the 12 years, how it’s gone so quick, I think that’s also the race against change and evolution that we’re seeing in the industry, so it’s been quite a time.
Michael: Full-timer, really a dyed-in-the-wool political junkie from the very beginning. It’s certainly not unusual for national associations to hire a CEO who has a legislative history and obviously that’s useful and that’s an important role. Now, I suspect that you have also seen that there have been trends and forces affecting the industry that are non-legislative in insurance right now.
Mike: Very much so. The thing about the legislative side is just about anyone can be legislative out of business in one stroke of a pen. That’s always been something that’s important that we do to advocate on behalf of our members. Frankly put, with what we see in the industry and some of the technology that’s coming and just change our consumer behaviors and expectations, it’s important that agents are keeping up with this change, so they can stay in business and still provide the value that they bring to the table, to their insurance because we’re seeing so much change within the agency, which I’m sure we’ll get into. We’re also seeing some that are a little bit slower to adopt the change. My role and your role in your organization is to make sure that our members have the knowledge and tools to take on those changes and those challenges that they’re faced with every single day to make sure that they’re as successful as possible in their daily lives.
Michael: Let’s start with exactly what you’re talking about and the sequence for me, listeners may know this. I don’t know if I’ve ever been quite this explicit, but generally, I’m looking for the answers to three questions from my guests. Number one is what do you see, what are the big trends and forces? I generally start with those things that we need to pay attention to strategically, and then the second question that I segue into is, what does that mean to an independent insurance agent of today? Then the third and final direction I take this is very tactical and very practical. What should they do about it? I’m always hesitant to ask people for tactics that agents should employ without first saying, what are the strategic forces that make that tactic one that we should pay attention to now? I want to start at the top level, big level, and for goodness sake, if anybody has a perspective on it, I think clearly you and your position, you do. Mike, what do you see what’s happening in the insurance industry right now?
Mike: Wait, I’m going to tell you it’s not just the insurance industry that’s changing.
Michael: Okay. [laughs] We’re going to go even bigger picture. I love this.
Mike: Well, it’s much bigger because frankly, it starts with consumers. We live in this ‘right here, right now’ world, as far as expectations go, and we have often answers right at our fingertips, so consumer behavior has changed so much and that’s affected the industry.
Michael: Right here, right now.
Mike: Right here, right now.
Michael: Well, frankly yesterday was Sunday and I was still a little bit irritated that my rabbit repellent didn’t show up on Sunday when for goodness sakes, I ordered it on Saturday. They’re eating my cactuses.
Mike: That’s exactly what I’m talking about. To bring it back down, the agents, their question and they’re pinged all day long, especially nowadays, you aren’t just calling your agent. You’re emailing or in some cases, you’re texting them. In some cases, you’re instant messaging and then through social platforms. There’s a lot of consumer pressure just on the agent in and of itself, but it’s doubling down on technology. How do you keep up with the changing consumer expectation, and how do you keep up with technology? I think overall, agents are doing a good job. Agents are a very resilient group.
The reality is, today’s agency is not yesterday’s agency, nor it will be tomorrow’s agency, that there’s a real need and a real demand that agents continue to change and continue to meet the expectations of the consumer. There’s an old statistician, which is interesting to me, it was Dr. W. Edwards Deming. He has this quote that’s always stuck with me for a couple of reasons, that he would say in public forums and it was, “Survival is optional. No one has to change.” It’s gotten different variations of it over the years. One of the probably the more common variations is, “It’s not necessary to change because survival isn’t mandatory.” I think that’s interesting in and of itself. Let me tell you the most interesting part of that, to me, is that he died in 1993. So, what you and I are talking about today, it has been discussed for decades, it’s not necessarily new. I think there’s an argument to be made that change in technology, maybe it’s evolving at a faster clip than it ever has before.
There’s always opportunity and there’s always light at the end of the tunnel. That’s what we’re seeing and when I engage with agents, which is every single day, it’s how do we guide agents and how does an agent take advantage of these opportunities in front of them and how are they continuing to evolve to meet the demands of the changing consumer, the changing demographics. The millennials coming on now. That’s the change that we’re really seeing.
Michael: You just summarized my annual State of the Industry report.
Mike: Oh, there you go.
Michael: There are a couple of things that you said that bring things to my mind. One is from a historical perspective, this is not the first time we’ve been in this rodeo. Mike, I got a few years on you and a few years on you in this industry. Shortly before I was the executive vice-president of the PIA in the western states, it was estimated that there were 80,000 independent insurance agencies. It was a few years before I was around. Also, I came into the industry in a time of some change. A lot of people don’t recognize that agency management systems, it may seem like they’ve been here forever, but they haven’t. I recall that there was considerable discussion and consternation about these things, computers, and agency management systems.
In fact, I think the very first meeting that I facilitated for the PIA was a battle of the agency management systems. I had a facilitator and three or four or five AMS systems all doing screenshots, and fighting against each other. It was very entertaining. In the audience, my members were looking at each other and saying, “Are you going to do one of these things?” and so on and so forth. Survival then was also optional. It was really fairly quickly that there were a lot of mergers and acquisitions and some going out of businesses.
Now, the number’s been pretty much riding somewhere at the 40,000 range. At this point, I can also help but wonder if the amount of change and the speed of change that’s being asked of people are going to– Whether or not, you’re just going to force another thinning of the herd. What are your thoughts?
Mike: I’m not convinced that it– Had there been 80,000 down to 40,000, that is 50% reduction simply because that 40,000 didn’t keep up with change. I think there’s a couple of factors there. One is you had an agency and you still do have an aging agency population. So, there would be-
Michael: There was a generational shift then too, right? The boomers were the–
Mike: It’s happening. We’re seeing the next generation go to that now. I think there’s so much opportunity in this industry right now. That’s why we’re seeing the past several years in private equity pump some funding in here, and that’s part of what I do, I believe, the agency force plus EFPE coming into it, those two things contributed to mergers and acquisitions. But frankly, the M&A activity is not solely due to private equity firms coming in. There’s a lot of retail-to-retail transactions. I think you may feel a smaller number of agencies overall like that you were alluding to, but it’s in part because we’re getting larger agencies as a result.
Michael: We are. I think to some extent, we’re getting stronger agencies. I think now it was 25 years ago, there’s a relatively easy and safe out. In other words, if somebody’s 65 years old and they’ve been running an agency for a few decades, they may simply not want to muscle up and make the transition that is required by external industry forces. They may look at that and say that’s perfectly okay. “I can get out and I’ve got a valuation that’s going to be quite acceptable to me.” From that point of view, it would seem that there’ll be a number of agencies who won’t be “modern” now, they might be modern when they get acquired one way or the other.
Mike: I think you’re absolutely right. Maybe they aren’t acquired. Maybe it’s just a generational switch internally.
Michael: Some of those.
Mike: Internal perpetuation.
Michael: There are some of those.
Mike: That next-generation, 25 years ago, will come and modernize that agency. I think you also have some agency principles that have said, “Listen, I’ve done it this way for 30 years, 40 years, pick a number and it’s worked and it’s worked really well. I’m going to plan to make an exit in the next couple of years. So, why shift now?” What’s interesting about this is I don’t believe that you need to take any agency and gut it because I think the change that we’re talking about, maybe its technology that are utilizing that for efficiency inside the agency, that sort of thing, the value proposition of what today’s agent did and their predecessor and their predecessor’s predecessor did, I don’t think that’s changing which is the relationship part of this.
Michael: Exactly, yes.
Mike: You can quickly fall into that where you’re going to automate your agency too much. Sometimes you hear about agencies that have really moved away from the human side to implement so much technology, that it’s backfired on them. I think that’s a mistake. Obviously, those that have been tripped up on that would say so as well. The one thing which is the crux of all of this that isn’t changing is the valued role of that agent.
Michael: Let’s zero in on that. You’d mentioned changes in consumer behavior. I want to start with that one. I think also, as you said, that kind of drives the entire industry ultimately. What do you think today’s consumer wants from a modern insurance agency?
Mike: For one, I think they want to be able to access information, and they’re able to do that online. When they are interacting with an agent, they want to make sure that they’re getting the quick proper response to information. I think an area that the industry could improve on is getting more bindable quotes instantly across all lines. If we’re having a consumer, a prospect, what have you, reach out to an agent and there’s going to be three touchpoints because the underwriter’s got questions, you got to go back, and I’m not talking about these real high-end, super complex policies.
I’m talking more mainstream policies that are requiring multiple touchpoints to the prospect. When the prospect is able to go on any website and buy any consumer good and have an instant transaction, that puts the industry at a competitive disadvantage. Now, in no way, am I inferring that we need to commoditize insurance at all. I think that’s the exact opposite direction we need to go into to put insurance products on a shelf, and you can walk out and buy it. We need to make sure that we’re doing the best we can, we have the most appropriate processes in place to make a real quick transaction. Again, once that policy’s sold, I’m not saying, “That’s it. You shelve that insured.” I think at that point, you build the relationship.
Michael: Boom. Got it. Tell me what you think of this. Sometimes I think that agents or an agency feels like when they sold the policy, that’s when the bell rings and that’s when we celebrate, and a job well done. Conversely, I think it’s probably more appropriate to say, “This is where the job starts.” It’s not hard to prove with really sound math, that the money’s in the relationship. The deeper and stronger you make that relationship, then clearly the higher customer lifetime value you get.
After the policy’s sold, it’s like, “That’s near the beginning of the conveyor belt in the insurance factory.” That’s not the end. That’s not the end product. That’s just the beginning of the raw material to create what we want, which is ultimately a highly loyal insurance customer.
Mike: A term we seem to hear more and more about is ‘experience’. What is the customer’s experience? The sales transaction, that sales process, it’s just one part of that experience and what you’re talking about, you’re absolutely right. From there on out, it’s building the rest of the experience. What’s the client’s experience? What’s their experience when they have a question about the policy? Liberty Mutual and Safeco just came out with a survey recently on millennials purchasing insurance.
Michael: Yes, I saw that.
Mike: They’re now at the point where they’re getting married and having kids.
Mike: Over half of millennials said that they want to know all the details of their policy. Of the millennials that are utilizing independent agents, there’s 80% of them, I believe, that said, they want to understand the policy, they want to know what happens if there is a claim. How do the coverages work? What are the different features or endorsements on a policy? Those sorts of things. You can list them all out, but if I were to describe that whole process in one word, it’s relationship. They want a relationship. They want to have an advisor that they can call and get questions and refer to and that sort of thing. That’s what I was mentioning a few years ago. There’s so much change going on. There’s so many opportunities or maybe some road bumps with technology. None of that is really grossly modifying that role. The agent providing information and forming a relationship and none of that’s replacing it.
Michael: We often talk about the consumer and how the consumer drives everything, but, Mike, fair to say that out of any sort of random group of 100 consumers, there are some who are really quite well-suited to be in a relationship with the Independent Insurance Agency System and some who are very likely better served because of their values and their interest by another channel Is that fair to say?
Mike: How do you look at it? If you’re looking at it from a business standpoint, maybe-
Michael: Yes, clearly from pure economics and business.
Mike: There’s a certain population out there that probably is buying, and it doesn’t matter whether you’re talking millennials or any other generation that are buying strictly on price. They don’t want the relationship, they want a quick transaction. It doesn’t if they’re bare-bones policy.
Michael: They’ll bring low customer value to the Independent Insurance Agency System. In some cases, negative customer value, but there’s a considerable population that wants exactly and values exactly what you talked about. That sense of relationship, the peace of mind that comes with that. That sense of knowledge being smarter, and so, boom. It seems that there’s some obligation. An agency needs to establish that it wants that relationship and then it needs to demonstrate that sense of relationship. It can’t just say it in a tagline and then sell the policy and go away for 11 months.
Mike: Yes, absolutely. There’s been studies. At PIA, we’ve done our own studies here about, what is the expectation of the consumer? We’ve asked consumers, “You buy online, what do you like about that? Why aren’t you using an agent? Why do you do that? If you’re utilizing an agent, what do you like about working with an agent and what don’t you like about working with an agent?” Overwhelmingly, those that are working with the agents, a lot of them say, “I desire to hear from my agent more than once a year at the point of renewal, even if it’s either a quarterly or semi-annual check-in.” I’ll tell you, my agent, I have a very good relationship with. It probably doesn’t surprise you.
Michael: They better take good care of you. [laughs]
Mike: Very much so, but they are routinely checking in, saying, “Hey, listen, your carrier came out with a new endorsement. I’m going to give you the information now. Ask some questions.” That’s not just because they’re doing that because I work in the industry. That is the expectation of the average consumer out there working with independent agents, they want to hear from you. I think that segment of the population that isn’t using an agent, they don’t care, they treat insurance like a commodity, I think they have something to learn and when they do have a bad experience with insurance, that’s when sometimes they realize, “I misplayed this hand. It is worth paying a little bit potentially, not buying a bare-bones policy just on price, but maybe a more comprehensive policy working with an agent.” It’s not a group of people you’d totally discount.
Michael: Clearly, values do change over time. There’s certain times in our life where frankly, getting the cheapest price, that’s a really high value for a lot of people a lot of the time and sometimes that evolves and it certainly has evolved with the millennial population.
Mike: They’re getting older.
Michael: They own more stuff.
Mike: Right, and we saw that with healthcare, actually. 10 years ago when I was going through- we looked at healthcare reform and we looked at the populations that were saying, “No, we want kind of a single-payer type system.” There would be drastic changes generally in a 22 to 24 year window, because what happened is, when they felt they wanted a single-payer system, right, wrong or different, I’m not getting into that debate, but people, they were in college, and all of a sudden they graduated and the cost of living changed and suddenly their opinions switched. That’s what we’re seeing with the millennial population now. They’re getting older. They’re getting full-time jobs, they’re getting married, they’re getting a house, they’re having kids, that sort of thing. A lot’s changing.
Michael: Agencies need to figure out how to be in relationship with them, even if they are not run by a millennial or a Gen X or– It’s too-
Mike: To go back to that Liberty Mutual survey, one of the questions was, and this was to the millennial population, do you want to or do you desire to have an independent agent your age? I want to say it was less than 10% said yes. They said, “No, I don’t care. I want the value of that independent agent. It’s not that they need to be my age too,” that sort of thing. “I have understanding of the value there and that’s what I’m seeking. It has nothing to do with what generation they’re part of.”
Michael: Got it. All right. I want to circle back to something you said a few minutes ago about the difficulty of keeping up with all of the new and emerging technologies. That’s a challenge for somebody who’s already busy running day-to-day operations and being an insurance agent and running a business. Now all of a sudden, they’re being exposed to, they’re being pitched, they’re seeing here, there and everywhere, some new technology. Frankly, first of all, the number of technologies is overwhelming and then knowing which ones to adopt in an agency can be really quite baffling and also, it can be relatively expensive to do it without some system that helps you make a good decision about it. Obviously, we’ve seen people making mistakes with technologies that are supposed to solve all sorts of problems. Talk to me a little bit about what you’re seeing in that arena because I’m sure where you are, you probably see a lot of technologies being offered before the average insurance agent. How do you see agents effectively filtering out and making decisions about technology?
Mike: First off, I think you hit the nail on the head, that a lot of today’s agents are saying, “I want to implement some of this stuff. It sounds great, but can I? Do I have the human capital or finance at the time?” Which is a change, by the way, because if you and I had this conversation a couple of years ago, I think the reaction that I was hearing from agents all over the country was almost of concern that they looked at technology, and specifically some of the technologies that were coming out, as nothing more than a threat. There are some leaders of some of these Insurtech companies that are out there pretty boldly saying, “We are designed to get rid of the agent,” and some of them have already failed. I think some of them have learned quick lessons but what we’re seeing now-
Michael: Back in the dot-com era, there were people who were bringing the death knell.
Mike: Yes. That threat to agents, that’s nothing new.
Michael: But I don’t think that means that we should just ignore all of these powerful trends and forces and tools. We can’t say, “Look-“
Mike: Of course not. In general terms, that’s been a change that we have seen over the past couple years because the agents that I’m interacting with today, they are not having that kneejerk reaction as I have seen at such a degree over the threat. Now they are at the point as you described them as, “I want to do this, but what does it mean? Can I can I afford it?” That’s a big question and some of these technologies are free. You’re looking at social platforms. At some point, over half of the independent agents were getting leads from their websites. Over three-quarters of them are now using social media. Almost half of those agents are actually getting leads from their social media. Some of these things are now outside of doing paid advertising on social platforms. Some of these are all but free resources. I think the hard part, and this is something that we work at a PIA is vetting some of these companies to say, “Hey, this one’s going to stick. This is what it looks like. This one’s going to be here in a year, in five years, in 10 years,” as opposed to, “Hey, this seems a little bit more like a facade and isn’t doing it.” It’s not worth the time or cost of implementing it.
Michael: What does an agent do to stay on top, do you think?
Mike: Well, one is break down the barriers. Look internally to your agency and determine, “Is this something that my current infrastructure could handle?” Whether it’s your agency culture and the staff on board, to having the human capital to invest in any technology to having the financial resources and what’s the cost of adopting any technology in your agency, and don’t look at it just as an expense or what’s the potential reward.
I emphatically do not see agents going away. What an agent does today likely is not what they’re going to be doing tomorrow. Their role in the industry is here and I think it’s going to be stronger than ever as we move forward. Their actual day-to-day, their role and their function in the industry, it might change because I think some of the technologies we’re seeing that are getting adopted into agencies, maybe they do create efficiencies and change your workflows. That might enable you to have some extra time to invest in some new areas. It’s in the agency.
Michael: Let me ask you a question and we’re going to get into the ‘making it real’ portion. What do you think the modern agency looks like? A really good modern agency looks like, that is giving delight to their consumers, to their customers. They’re attracting people and they’re delivering a customer experience like you talked about earlier, that adds some value and some delight. They create deep relationships with their existing customers. What are they doing that makes them a modern agency? Then I’m going to follow it up with what do you think, like agencies who want to be a modern agency, what should they do right now so that they’re in strong viable condition three years from now? Part one, what does a modern agency look like?
Mike: Well, I think they look a little different. I’ll tell you why. I still think there’s a cookie-cutter approach to this. Tip O’Neill used to say that all politics is local, and all insurance is local.
Michael: All insurance is local. Okay.
Mike: Right. Independent agents, I think the number one-
Michael: That’s a critical principle and maybe that’s a longstanding principle, but that really is that principal relationship. In my community, right here to make it work, whether it’s, “I’m local,” or, “I have a niche with a broader footprint,” I think to some extent what you’re saying like Tip O’Neill, right? He was in a relationship with his constituency and that’s what made it work. That’s what gave him power.
Mike: If you’re an agency that is in the middle of small-town America and that’s local to you and that’s your community, then know it and own it. Maybe as you said, you got a larger footprint, maybe you are in multiple States and you have multiple locations or larger producers. Know your client base and know them well and part of that is understanding their expectations and understanding everything from how often they want to hear from you to how they want to be communicated with and having the appropriate systems in place. Whether it’s social platforms or other means to communicate, is your role and your value with your insured, you’ve got to understand your customer base and know it well. I think, in general, agents do if you implement some form of technology that automates that, who would agree where it removes the human from it, I think that’s a mistake.
But with all the tools that are out there now and the ones that are around the corner in terms of technology tools, most of them that I think are a benefit to agents are not designed to shut down the retail agent. I look at them as tools. Your toolbox just got bigger and you have a new tool based on technology that you can use within the agency to better meet the needs of the industry, of your current client base and your prospects. We talk about the generation that is growing up and is buying insurance is that millennial force right now. Making sure that as you can evolve, you have the technology in place to meet that particular need. It’s not necessarily a cookie-cutter, it’s knowing your client base, who they are now and who you want them to be tomorrow as you grow your business.
Michael: Got it. I think safe to say, Mike, that you can use technologies to amplify your sense of humanity and community and connectedness without– Back in the day, let’s say, dot-com, there was some concern we were all going to be dehumanized because technology would interfere. I think we’ve discovered that in fact, technology can clearly support human communications and the sense of human relationship. That said, the actual human never goes away. We can use technologies to deliver that sense of who we are and why we care about our customers.
It seems to be inescapable and frankly, I’ve been having these conversations, Mike, for over two years with the thought leaders of the industry, I’m summarizing what you’re saying and it aligns with what I think the best of my own guests have said is that change is real and if we choose to survive, we want to meet the pace of change. We can’t be slower than the existing pace of change. Two, that there is a real role for the independent insurance agent and three, that clearly we need to be– We can’t be a technology phobic. We need to embrace technologies and have mature and serious criteria to help us determine which ones will help scale our agency.
Mike: It’s going to be different for everybody. I was looking at my kids yesterday and I have four kids and I was thinking we’re in the middle of summer now and they’re out of school. How remarkable their childhood, how different it is than mine and this is strictly when looking at technology.
Michael: You’re going to have some issues to deal with, my friend. I don’t know how old your oldest is.
Mike: He is 10.
Michael: Yes, there you go. My grandkids are like- the two oldest are 10 and it’s like, wow, they’re on the precipice where now they’re going to have issues to deal with that I didn’t have to raising mine and your folks didn’t have to raise it yours.
Mike: Right. I don’t know, we’re balancing as parents how to take them out on the side during the summer, right? Give them a garden hose and tell them to come in with their technology desire.
Michael: [laughs] Yes. Their appetite for technology’s probably bigger than your willingness to feed them those technologies.
Mike: From my generation to my kids’ generation, their needs, their understanding, their adoption to technology, it just blows my mind. When I look at the industry and think, gosh, and the amount of time I’ve already worked at PIA, that generation will be buying insurance, and are we ready for that? Are we preparing at the right speed for that?
Michael: It seems that like we could put a little ribbon on this part of the conversation by saying every agent needs some rhythm, some disciplines, some cadence where they review existing technologies and they probably need some internal criteria to help them make some decisions about whether or not that technology will help them scale or not. That is now part of the job of being an ‘insure-preneur’, is that a good premise?
Mike: Yes, I completely agree with that. That, in doing so and heading in that direction and adopting the appropriate technology for your agency in your community, does not take away from being the advisor that you are. You can ensure your credibility-
Michael: It could support it, right. It could complement it.
Mike: It’s absolutely right. It’s a tool. It’s an extra tool. It’s not a threat. If you use it as a tool, the sky’s the limit.
Michael: While I have Mike Becker on the phone in your position, if you would, tell us what’s happening with Professional Insurance Agents Association because I know you’re creating initiatives that are intended to respond to these forces and trends. What’s going on at the national level?
Mike: Well, I appreciate you asking. We’re doing a lot. We’ve really evolved this organization over the past several years, and we have a lot more coming back. As an organization that provides services and programs to independent agents around the country, we have independent agent members in all 50 States in DC, in Puerto Rico and Guam. We wanted to get away from really what was the stale association model of just discounts, that sort of thing, and bring forth programs and services that really help independent agents on a daily basis. What we’re doing is really based on technology a lot of cases to make it a lot more streamlined and efficient. How can we help agents make more money? Last year or 13 months ago, we rolled out our market access program, piamarketaccess.com, different markets to agents to help them sell more and get appointments. Actually, what we’re rolling out in the next couple of weeks here in the very near future is something called the DMV which is PIA’s Direct Marketing Vault.
This is actually something that’s cool. We’re building on something of the past that worked and we’re applying technology to it. We’re going to be working with the postal service actually where agents can identify a prospect based on a series of demographic information. We have customized material and templates to send this very specific class of people that an agent desires communication to the postal service.
That’s looking back, but what we’re able to do now with technology is identify who the agents selected through those demographics and put an IP address on top of them based on available information. They then convert their messaging to digital ads. Now you’re able to hit people digitally, you’re able to put something in their hand and you’re able to just cast a wide net but only as wide as you want to go to the people that you want to go to and hit them in different methods.
Michael: Is that a personalized initiative?
Mike: It doesn’t have to be, no.
Michael: Doesn’t have to be.
Mike: It’s whatever class you can– People you want to do, whether it’s businesses, whether it’s through a neighborhood-
Michael: That’s interesting. This is the first time I’ve heard about this.
Mike: -whether it’s based on age, whether it’s based on income level. Then like I said, there’s a lot of marketing experts that say, “You got to hit someone seven times before they start to stop and read.” We have this multi-faceted approach now that is based on what’s worked in the past when we used to do direct mailers. We’re narrowing it on the part that really worked the really specific audience and we’re now able to put the IP address on top, convert it to digital ads, and go after them from a digital angle, putting something in their hands.
Michael: Interesting. This is the DMV project?
Mike: That’s what we’re calling it, the Direct Marketing Vault, PIA-DMV. We’re actually rolling that out as part of our branding program. These are programs that are overwhelmingly free to members or some tie-up function if you’d like to do that with programs. We provide blog content that’s consumer pointing with infographic, social media content with advertisings that you want to put in the local paper or a church bulletin. Most all of this is overwhelmingly free unless there’s some print costs or whatever.
Michael: Fascinating. When do you anticipate this is going to be available?
Mike: The PIA branding program is available now, piabrandingprogram.com, but the DMV will be probably in the next week or so. This month in July, we’ll have that out.
Michael: All right, excellent. Anything else that’s big on the horizon? I know that you, obviously, have a legislative background and interest. Is there anything that agents need to be looking out for or vigilant about in legislative fronts?
Mike: A lot of the programs that are regulated at the federal level, where we’re talking flood insurance which has been a big issue this year, as it seems to constantly be at operations-
Michael: As it so often is.
Mike: As it so often is, but same with cyber liability. They’re looking at some initial kicking of the tires, so to speak, maybe converting cyber to a federal backstop program like they do with terrorism insurance, potentially a cyber attack that’s so large that insurers would have paid into a federal fund, but they stop it. That’s an evolution that we’re keeping our eye on that front. The big issue that we’re seeing continue to creep up, a little broad and specific coverage like flood is, just general regulation of insurance, but there’s still a desire of many who have state law preempted and have a this done by the federal government.
We talked about on this podcast about insurance being local and community-driven and than when your customers and relationship. You really get away with that with a 1-800 US government telephone number. That’s an issue that continues to come up.
Michael: That’s a conversation that’s been around for at least 25 years.
Mike: At least, yes.
Michael: It’s probably foolish of me to ask you, do you have predictions about it, because there’s so many variables. Is there any sense that there’s new muscle behind that initiative or is it just that’s the ongoing conversation we need to monitor?
Mike: If you go back about 10 years to when Dodd-Frank was passed, up until that point in time, there was really efforts to rip a bandaid and do it at once. You’re either going to all state regulation or all federal. When Dodd-Frank was passed, we believe what the intent is you have the camel’s nose under the tent. You piece-meal it. They created the Federal Insurance Office in the Department of Treasury.
Now you got a Federal Insurance Office. They don’t really have regulatory authority, but they seem to be getting their hands on a lot. We perceive that to be- if groups like PIA are asleep at the wheel, the first step to federal regulation. We are big believers in the state regulatory environment at PIA. I will tell you that if there’s anything that is helping keep it at the state level, it’s the inability of congress to really come together and pass much legislation-wise.
Michael: All right, fair enough.
Mike: Not to look in a crystal ball but that seems to be the biggest hurdle right now is tripping over our feet.
Michael: All right. Mike, before we wind this up, I want to give you an opportunity to step on a soapbox and say, if you had the chance to say- just to deliver a message to the Independent Insurance Agency System and the people who run it and the principles who operate their agencies locally, what would you say to agents today?
Mike: I would thank them. They are such an integral part to the insurance industry. I would tell them that I think there’s a lot of perceived threats out there. If you look just past the first layer of a perceived threat, there’s often hidden opportunities. I think the independent agent, your future is bright, but it does in part rely on you and organizations like PIA helping you evolve to take on the future and to help you take on your daily challenges, but the future without a doubt is very bright for the independent agent.
It might look a little bit different than it does today, but the opportunity is there, the future is there. I hope that PIA is able to help you achieve the most success as you can as you take on the future.
Michael: Terrific. I have one last thing. I have spent a great deal of my career and adult life, both as a volunteer and as professional encouraging volunteerism and participation, whether it was in communities or charitable activities that I was involved in or professional societies and associations. I would be remiss if I didn’t give you an opportunity to tell you people or encourage our listeners to be involved and maybe share a little bit about what they get out of it.
Mike: Right. One of the things that I think is a differentiator for PIA is that we are just driven on a daily basis by our members, our independent agent members. Frankly put, what we, as an organization, believe in is quite simple. It’s about the success of agents. We don’t overcomplicate that. There’s important parts of running our organization. We work with our stakeholders across the country, we are updating our own processes to adopt more technology and to operate more efficiently.
In reality, we’re laser-focused on changes that help us support agents. That’s simple. If you go to www.iampia.com it’ll take you to a page of agent testimonials that are part of PIA. They’ll tell you the importance of- don’t listen to me, listen to the agents themselves of the importance of being part of an organization and part of a community which is really what PIA is and frankly put, how to be part of our PIA community.
Michael: Outstanding. That URL is iampia?
Michael: Excellent. Okay, got it. All right, Mike, it’s been a pleasure catching up to you. I’m glad we were finally successfully able to have this conversation.
Michael: Perhaps you here at a Diamondback’s game one of these days.
Mike: I will let you know if that happens.
Mike: Hopefully those Nationals will take the win that day.
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