Selling insurance during COVID-19: The pandemic’s impact on independent agents
Written by the Agent Clearcover Team | October 4th, 2021
Just like the rest of the world, the insurance industry had to adapt quickly at the start of the COVID-19 pandemic to meet changing business and customer needs. And those initial shifts at the start of 2020 have had long-term business repercussions for agencies and customers alike.
We wanted to see just what those repercussions looked like for independent agents. So in August 2021, Clearcover surveyed nearly 500 independent insurance agents and brokers to get insight on how COVID-19 has affected insurance industry professionals.* Here’s what we discovered:
Independent agents had to adapt quickly (many taking losses) at the start of the COVID-19 pandemic in the U.S.
The increased use of digital tools has helped in the industry’s recovery, with many agents choosing to continue using digital tools while selling insurance remotely or from home.
Let’s look closer at our findings—and then we’ll dive into how independent agents can apply insights from this survey to build momentum for their businesses.
How has COVID-19 affected the insurance industry’s independent agents?
Here’s one of the most significant findings from the survey: If you’re an independent agent and you’ve experienced a difficult time since the start of the pandemic, you’re not alone.
83% of independent agents struggled with customer acquisition during the pandemic (and 69% struggled with customer retention).
The majority of those surveyed (89%) made significant changes to their business to weather the pandemic.
Without the extra stability of working as a captive agent for an insurance company, independent agents and brokers faced unique pandemic-related business struggles. Changes had to be made quickly, and without the guidance or support of a larger insurance company, many independent brokers struggled to pivot their strategies—resulting in significant business losses.
Agent respondents reported an average 38% drop in revenue. And the majority of independent insurance agents we surveyed (61%) stated that COVID-19 and the related economic crisis had a negative impact on their business.
The silver lining? The pandemic also provided some growth opportunities, with many agents choosing to invest in digital tools to continue simplifying their work.
Have independent insurance agents recovered from the initial challenges of selling insurance during COVID-19?
Now for some good news: Although many independent agents saw losses after the start of COVID-19 in the United States, 68% of independent agents say customer acquisition has returned to pre-COVID levels—and 75% report customer retention has returned to pre-COVID levels.
Selling insurance during COVID-19 presented a big challenge to the industry at first, but these numbers show meaningful recovery is taking place, with over half of agents surveyed (56%) saying their business is back to operating as it did pre-COVID-19.
So how can independent agents keep this momentum going? Our data about digital insurance solutions provides some clues.
Digital tools are a crucial part of how to sell insurance during COVID-19 (and after)
Selling insurance from home or working asynchronously required independent agents to pivot quickly at the start of the pandemic. While some agencies were already set up for remote work, many other independent agencies and brokers found themselves making nimble decisions to continue doing business.
One of the most common pivots? Switching to digital insurance solutions.
The use of digital tools to support or enhance remote work increased across the globe, and independent agents weren’t exempt. In fact, 92% of agents say digital tools were a main contributor to their success during the pandemic. And 98% of those surveyed reported that digital tools have made their jobs easier.
In addition, agents reported that the pandemic doubled-down on insurance customers' demand for more digital tools. In fact, agents saw an 11% increase in customers making purchases fully online.
The real kicker? Ninety-six percent (96%) of independent agents say their customers are looking for more digital tools now than they were pre-pandemic.
It’s clear that customer demand for digital insurance tools is a trend that’s here to stay. (Need to support customers looking for tech-driven auto insurance? Clearcover is your auto insurtech partner. We provide app-based and easy-to-understand auto insurance policies that customers love.)
Selling insurance from home and working virtually—Tips for building momentum
In a world that’s still learning how to live and work through COVID-19, working virtually while continuing to focus on customer acquisition and retention can be challenging. Our data shows that 73% of agents switched to working remotely or from home, at least partially, with most anticipating a slow, gradual return to the office (if at all).
And post-COVID-19, 88% of independent agents agree that customers expect processes to be automated.
How can independent agents continue to provide an excellent customer experience for clients—all while growing their client base and providing a digital, more automated customer experience? It’s a tall order.
We’ve included some tips below for selling insurance virtually as an independent agent. With the changes that COVID-19 has brought to the insurance industry, it’s an excellent time to reevaluate current systems and processes and make adjustments for continued future growth.
1.) Audit or create your digital marketing strategy.
What is your agency doing to get in front of new clients in digital spaces? People are spending more time online since the start of the pandemic. Take time to audit your current strategy (or create a new one from scratch).
Social media is an important tool to include in your agency’s marketing mix, and 54% of buyers use social media to research before making a purchase. To simplify your agency’s social media presence (and maximize your time), you can use social media planning and posting tools such as Later or Planoly. That way, you can focus on selling and set your social media accounts on autopilot.
If you don’t already refresh your business’s social media pages and website annually, now is the time. And if you’ve made notable adjustments to how your agency gets work done since the start of COVID-19, make sure to communicate those changes in your digital marketing efforts.
2.) Review your insurance products (and their impact on your customer).
To continue building momentum after economic setbacks from COVID-19, review all the products your agency currently offers. As you do, think through your customer’s experience of those products. Which of the insurance products that you offer already provide a seamless or automated digital insurance experience to customers? What products feel clunky to sell and use from start to finish?
Remember: In our survey of independent agents and brokers, we found that insurance customers are seeking out more digital products and automated insurance experiences. How can you meet that increased demand in your agency?
Your customer’s experience is often dictated by the carrier they choose. Having an in-depth knowledge of your customer’s digital preferences can help guide them to the right insurance product.
3.) Refresh the processes in your customer’s journey.
Walk through your customer’s experience from the first call or email to a renewal in hand: Where are the hiccups—and where could you include a digital solution? Are there certain technology solutions that could meet specific customer needs (and solve those problems for you)?
Using a CRM, such as Applied Epic, can streamline your regular communication with clients and organize those important relationships. And if quarterly automated emails would assist in keeping your agency top-of-mind with customers throughout the year—as well as provide helpful education to your clients—investing in an automated email marketing solution might be right for your agency.
Grow your agency with Clearcover, your auto insurtech partner that puts customers in control
In a changing industry impacted by COVID-19, Clearcover is here to support independent agents and brokers through smart and powerful tech-driven auto insurance. No secrets. No surprises. Just smart, easy-to-understand insurance at a superior value.
Impress your clients with a seamless experience, from quote to claims resolution. Request an appointment with Clearcover today. Already with Clearcover? Login to the agent portal.
*We polled 475 independent insurance agents and brokers in August 2021 with 475 total respondents. The survey was conducted at 95% confidence, +/- 4% margin of error.
