This post is part of a series sponsored by Actentsync.
The reality of today’s insurance landscape: speed is king.
A study of lead-responsive suppliers said 78% of sales went to the first supplier to respond to the leader. Speed is positively correlated with insurance business sales, customer retention and recommendations.
For insurance carriers and institutions, interactions with policyholders depend on your speed to quote, bind and pay retained claims. Speed is also crucial in less visible parts of the business, with manufacturers and other distribution channel partners deciding which carriers and quotation coverage represent.
But insurance companies and institutions know they can’t be so quick that they cut the corners down with compliance. So, how do you balance the need for speed with the knowledge that is essential to producers and customers?
The clear and obvious answer is to take an active approach to digital technology prioritizing in order to manage your producers’ onboarding, compliance and distribution channel management processes. But not all technical solutions are the same.
Hierarchical management: Hidden superpowers
Most producer compliance and distribution channel management systems have a synchronized with the industry’s true source, some contract components, and certain elements that integrate with other systems (although we will certainly still argue that versions of these things are cut from the rest). However, most solutions on the market do not handle hierarchies well. Why is hierarchical management of everything worth investing in technology?
Ultimately, it depends on the speed of pairing with trust. Moving quickly and cracking may work well for Silicon Valley companies, but insurers and insurers can’t bear the burden of disrupting things, whether it’s due to regulators or reputational risks to their partners and consumers. But progressive efforts require insurers and their partners to deliver at scale and at speed.
Without strong hierarchical management, moving quickly with your distribution partners can pose many risks.
Why Hierarchy Is Important – Non-Properties
Before you dismiss the following risks too early, know that these are more than just a thought exercise. A proxy partner reveals over 4,200 unique business entities in its hierarchy. After being able to match the different partnerships and business relationships in the system, they saw that about 20 entities were responsible for more than 60% of their business volume.
Without visibility into mapping producers to upstream and downstream business relationships, the business may miss where to apply their efforts to the best results.
Running risk with poor hierarchy management
Orphaned data
Your data ends up being orphaned when different departments manage hierarchical information in “comments” of spreadsheets or digital files. This exacerbates the already mentioned issues and causes additional headaches to get producers right and recorrect all new contacts in your business. Apart from that, you cannot accurately assess your partner’s performance. Who deserves your time and expenses to invest in your partner? If you have no visibility into your partners and their relationships, you will be missing data about who is critical to your success.
Waste of employees’ time and opportunities
When your organization does not properly classify partners and does not reflect their relationship with you and each other, accuracy is a tedious manual process that requires your employees to take the time to find information. Regional changes in an organization’s pecking order summarize hours of data reconciliation, which is the opportunity cost of other high leverage work your employees may be doing. If you don’t want to take the time to manually perform fact-check information, you can always accept higher order rates for your license or appointment application, business or commission processing. Because who doesn’t like the high-end black brother rate?
Poor management of the committee
If you don’t know every producer that owes offline and how to allocate commissions to their online agents, you may face several risks. Your lowest risk is that you will pay the commission incorrectly and then you will have to return it. However, you also risk mismanagement of state laws and trigger regulatory audits. If you sell W-9 employees on your behalf, poor commission management may cause you to conflict with the Ministry of Labor Protection.
Reputation damage
Missed, delayed or closed committee payment? Slow induction process? Every touch point with your partners and extending to their customers is your moment of impression or pain. When your system cannot accurately represent where an agent is suitable for its business hierarchy, it is like being called over and over by someone else’s name.
Regulatory Audit
Problematic payments and inaccurate documentation risks attract anger from state regulators. Worse, manual hierarchical management for insurers and agents could mean turning simple data queries into comprehensive audits and spending hundreds of thousands of hours on data searches.
Change Management
Let’s try a hypothetical: your downstream agent partner has been owned and operated by the same agent for 50 years. The new owner intervened and suddenly there was chaos. You have multiple updates – the value of the record, hundreds of contracts need to be changed to reflect this new information. This is an administrative nightmare for both of you and Newcomer to your partnership.
What sets up proxy synchronization hierarchy management
Actentsync hierarchy management is separated from the current market standards because it:
- Going beyond simple parent/child relationships, instead visualizing the most complex hierarchy, whose entire background is who has been licensed for contracts and products.
- The entire hierarchical record is updated when license status changes or when enterprises add new contracts.
- As a source of authenticity for hierarchical and relational data, ensure that committee calculations in downstream systems are based on the latest, correct hierarchical information.
- Simplify the workflow by automatically routing it to the right stakeholder approval requests, greatly reducing the time it takes to get on the producer or reorganize the team.
Ultimately, most of what makes Apsentync hierarchy management is that it is a solution for insurance. Multi-level coverage, effective changes and need online approval? These are not some professional customization jobs, and these industry-specific needs are out of the box.
By powering your distribution channel management with modern, intuitive hierarchical management, you can move at speed and at scale without the business risks inherent in manual and traditional relationship management approaches.
To learn more about how agency hierarchy management can speed up your onboarding and scale your business effectively, watch a demo or schedule a personalized consultation.
