Without industrywide efforts to improve, the insurance industry will continue to be susceptible to alternative markets, alternative-distribution channels, and competition from noninsurance entities. It's time for the industry to take charge of its future by proactively addressing long standing industry business problems. This is what the QIC is all about.
The Quality Insurance Congress (QIC) is a Commercial Property/Casualty insurance association made up of broker/agents, carrier/reinsurers, third-party administrators (TPAs), and risk managers. Its purpose is to get every constituent of our industry focused on improvement. The most recent Quality Scorecard, a product of QIC and RIMS and conducted by the Katie School of Insurance at Illinois State University, has just been published. Here are some of the results as they apply to brokers and agents:
- The good news: Brokers and agents ranked higher than carriers or TPAs in the three major categories-performance, satisfaction, and loyalty.
- The bad news: The scores for agents were still mediocre (74% performance rating, 70% satisfaction rating, and 74% loyalty rating).
Although rated better than carriers and TPAs, agents need a better understanding of what drives customers to high satisfaction levels-and a change in our ways of doing business to meet our clients' requirements.
THE COMPONENTS
The most important driver for customer satisfaction was the ability of agents to 'build internal and external partnerships.' The components of this satisfaction driver were:
- Negotiating and assisting in negotiations with carriers
- Identifying and managing conflicts of interest
- Being a part of a team that develops client solutions
- Developing a long-term partnership with the client
- Dealing with one uniform company
The overall rating for this driver was 76%.
Customers ranked 'trust and reliability' as the second most important driver. This category involved:
- Maintaining high ethical standards
- Providing trustworthy advice and counsel
- Consistently fulfilling commitments and promises
- Providing full disclosure
The third most important issue to the customer was 'two-way communications.' This involved:
- Actively listening and understanding the customer's business
- Communicating effectively
- Meeting with the customer to review coverage and policies
- Keeping the customer informed
Another driver important to the customer was 'identifying needs and creating solutions.' Included were:
- Accurately evaluating exposures
- Responding to the customer's needs
- Offering insurance and noninsurance options
- Providing innovative solutions
- Providing solutions that match the customer's needs
- Offering effective risk-management solutions
Equally important to the results of this study was what the customers did not think is crucially important to their satisfaction. 'Developing and providing expertise' and 'operational efficiency and competitiveness' did not rank high with most customers in the creation of performance, satisfaction, and loyalty to their agent or broker.
In its simplest terms, customers are more concerned about the relationship issues with their agent or broker than they are about the insurance issues. For the most part, customers assume that their agency is competent, expert, and efficient in its operations. If any of these components is not there, you have failed to meet the client's 'must-haves' and will lose the account. And if you have not built a strong partnership, trust, and communications relationship with the client, he will remain less than satisfied with you and will be open to competitive quotes and offers from other agents and brokers.
Now you know how clients feel in general terms. What are you going to do about it?