“Real Time – It’s Doable”
Posted by Mason Power - June 12th, 2009 at 11:06:01 amThat’s how I would title the opening remarks made by Brady Polansky at the ACORD AUGIE conference on real-time rating this week in Atlantic City. Brady heads the AMS User Group among other industry roles (see bio here).
ACORD Real-Time Rating Conference Atlantic City, NJ June 9, 2009
Insights from Atlantic City Part 1 of 2
The theme of his 30 minute talk was aimed squarely at the carriers among the 75 attendees: “To grow premium with independent agencies, make it absurdly easy for them to do business with you.”
Expecting the conference sessions to be very granular about real-time implementations, I was surprised that instead speakers were sticking with the basics and defining ROI for real-time and giving motivational speeches about what real-time means for sourcing new business and conducting business more efficiently.
Most people knew downloads but real-time seemed scary to others – not growing premium is scarier, right? Speaker Ron Binning is a rural agent who works with small regional carriers exclusively and added that of the 9 he works with 4 are now real-time and he ran historical analysis to prove that premium has grown with these 4 carriers while remaining flat to shrinking with the 5 old-guard carriers.
Brady gave a quick and useful history of real-time from Ross Perot’s letter to the NAIC in the 1960s defining the need and benefit for electronic transfer of data among agents and carriers. Citing this letter as the origin of SEMCI, Brady pointed out that carriers in the 1960s preferred having their agents glued to them through proprietary and unique business methods and that carriers worried about commoditization of product and service – they don’t want to compete on price alone.
Wonder what an Agency Insight Tour would have yielded in 1960s? Maybe the next tour will be in a vintage VW bus.
Quoting $280 billion as premium sourced from independent agencies versus $70b in premium going direct to carriers, you didn’t have to be Einstein to see between Brady’s lines that carriers must make the financial investment now to make agents happy with their service.
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