Post-Pandemic Outlook for Brokers: What Industry Changes Will Persist?
As COVID cases fall and vaccinations ramp up, the world is inching closer to some semblance of normalcy. This is a welcome sight for brokers who’ve been hit hard by clients’ businesses shutting doors, moving to alternatives for coverage, or simply refocusing energy away from their insurance needs.
However, some of the biggest challenges faced by brokers this past year are expected to persist. They need to make plans of action to thrive, not just survive.
As previously mentioned, workforces and businesses have had to leap into the unfamiliar landscape of digital marketing, virtual selling, and less traditional outreach methods in lieu of the pandemic. The brokers that have been slow to adapt have seen their books dwindle, creating an opportunity vacuum wherein the most inventive, adaptable brokers can profit.
Brokers who can and want to invest energy into social media, personalized email campaigns, and perfecting virtual meetings have plowed ahead, while many brokers opted to sit on their books waiting for the storm to pass.
Cheap Workers’ Comp Market
Across the country, brokers face the reality of plummeting insurance premiums, increased competition, and the growing popularity of state-run insurance funds. For example, it’s estimated state funds now insure more than 40 percent of California businesses.
Brokers who, in the past, secured and retained business primarily on a cost basis should anticipate difficult days ahead. As of right now, the comp market doesn’t show signs of returning to previous levels any time soon, forcing brokers to adapt and provide additional value.
Adjusting to the New Climate
Like many other industries, insurance and workers’ comp relied on face-to-face communication and a physical presence to build strong networks and client relationships. From Zoom to Slack, virtual forms of communication feel like a far cry away from in-person meetings where you can observe body language and non-verbal cues.
After a year in the pandemic limbo, it’s clear many brokers and business owners can’t wait to return to the pre-Covid world of in-person meetings and relationship building on the golf course and in the steakhouse. However, there are also just as many business owners who have become used to and comfortable with this new order of business.
In fact, this trend has been bubbling to the surface even before the pandemic. In a 2019 survey by McKinsey and Co. B2B purchasers were twice as likely to choose a provider that provided an outstanding digital experience compared to a poor digital experience. Even further, 33 percent of buyers rated the option to “live chat” on a website during the research phase of their buying journey as one of the top three requirements for a best-in-class partner.
Now, this isn't to say you need to hire a team of digital marketers, learn to code, and invest millions of dollars into a top-of-the-line website. What brokers can try is surprisingly not that far away from what they already do.
For example, if you usually reach prospects through cold calling, take that canned voicemail message you usually leave and try it in an email campaign. Platforms like HubSpot, Mailchimp, and others have free and inexpensive email marketing tools that allow you to send automated emails, personalized messages, and more.
Additional virtual and digital outreach techniques you can easily put into practice include:
- Investing in an online calendar for prospects to painlessly click from emails or your website to book virtual meetings.
- Host live webinars/chats/etc. to educate your community about upcoming rate changes and partner offerings.
- Post more frequently on social media. Social channels give you free or inexpensive reach to potentially thousands of prospects. If you provide value, they will come.
- Create personalized cold outreach videos using a tool like Wistia with a webcam to capture your target audience’s attention and trust.
All of the above tools have minimal learning curves but massive upside.
New Ways of Doing Business
We must all understand and accept that the way the insurance industry used to operate is unlikely to return. Businesses coming back from the pandemic will be busier, comfortable with remote work, and more risk-averse. As we all build back, it’s more important than ever to get creative with the ways we:
- Add value to our client relationships
- Target outreach to prospective clients to grow
At BBSI, we expect some fundamental industry shifts that will become a more permanent part of our working landscape, including:
- Predominance of virtual communication
- Increased client scrutiny of workplace safety, employee health, and risk mitigation
- Better risk mitigation for human resources and payroll management
Our customers will be more selective about services they pay for and seek a better “bang for their buck” in HR and workers’ compensation products. They will want assurance their brokers provide them the best advice and service. Insurance is a commodity we all need but hope not to use. If your clients understand how they can avoid climbing X-Mods and premiums, they will be more motivated than ever to implement them.
Finding a Balance
As important as it is to be more flexible with how we interact within our communities, it’s also important to be confident in what you know works. Now may not be the time for many brokers to invest hundreds of hours and thousands of dollars into outreach ventures that may or may not pan out. It’s important to be discerning with your growth strategy and have a plan to navigate this new normal.
Balance some inexpensive new strategies like targeted email campaigns or online calendaring with some tried-and-true sales tactics you’ve used your entire career. After all, you’re a salesperson first. With a balanced, level-headed approach to revamping your tactics, you can ensure your years-long client relationships remain solid, and new ones can blossom.
We’ve all had to make fundamental changes to our workplace practices to ensure we meet our clients’ needs during this unprecedented time. It’s more important than ever to provide your clients with more support, resources, and, yes, value. However, we understand that it can be a heavy load to carry as one broker with several clients.
BBSI works alongside brokers in their client relationships and offers expert, one-to-one consulting in crucial business functions traditionally overlooked at small and growth-phase companies like human resources, operational risk and safety, payroll management, and more. When you partner with BBSI as a broker, you not only give your clients competitive workers’ comp rates but also world-class, local business consultants that help your clients manage X-Mods, improve hiring practices, and grow sustainably.
With a 90 percent client retention rate, make BBSI your secret weapon for protecting and growing your book.
Disclaimer: The contents of this white paper/blog have been prepared for educational and information purposes only. The content does not provide legal advice or legal opinions on any specific matters. Transmission of this information is not intended to create, and receipt does not constitute, a lawyer-client relationship between BBSI, the author(s), or the publishers and you. You should not act or refrain from acting on any legal matter based on the content without seeking professional counsel.