Meeting the risk management needs of today’s small businesses requires as much finesse and sophistication as carriers tend to offer larger enterprises.
Insurance agencies and small businesses are facing a period of communication transition.
The days of having to pick up a phone or send something in the mail to get business done are long gone. Today’s world of SMS and email is synonymous with brevity and efficiency.
In small business insurance, the winners will be those who “do not just digitize existing services, but use digital engagement to deliver value in new ways,” said Jeff Duncan, Commercial Lines Manager, Asset Liability at AmTrust Financial Services.
“More and more customers expect not only to communicate digitally with their insurers, but that digital channels can bring them additional value far beyond simply applying for an automatic ID card or using an app to report a claim,” Duncan said.
And a similar dynamic is required in the relationship between carriers and agencies. Today’s brokers and agents need to quickly determine which insurers can provide the robust coverage their small business clients need.
From launching API integrations for seamless quotes and compelling agency interactions to offering a robust cyber insurance solution for small businesses, AmTrust Financial Services has invested in resources to help small companies to anticipate threats and develop their risk management strategies.
“The future is not in reactive protection,” Duncan said.
There are six ways small business insurers can ensure they don’t overlook the needs of today’s small businesses.
Providing malleable policy solutions
Meeting the insurance needs of small businesses starts with understanding the requirements of agents and brokers.
There is a common business model in the insurance industry among major carriers that relies on agents using service centers operated by those carriers to manage their renewal book, Duncan explained.
“One of our assumptions is that service centers are often band-aids for poor technology, especially in an era when some carriers are pursuing direct-to-consumer models,” he said. “Agents are going to be increasingly concerned about the service desk model, and who they allow their customers to be managed by, and how they allow that management to take place.”
Seeing this trend, AmTrust is taking a malleable approach to the policy service.
Using application programming interfaces (APIs) and microservices, AmTrust focused on providing a low-touch, cost-effective mechanism for agents to create their own customer experience for their customers.
This allows agents to fully engage with AmTrust on their terms rather than being locked into an operator-built customer experience and process, Duncan said. “That said, we know some agencies like the service desk model, and we’re exploring ways to meet that need,” he added.
Anticipating the needs of small businesses
For Duncan, delivering value to customers starts with looking at how customers interact with a business and then asking, “What is the need behind this demand? »
“We invest in both technology and product innovation to not only meet the needs of small businesses today, but also to anticipate and monitor needs that will continue to evolve in the future,” said he declared.
As a well-known workers’ compensation insurance provider, AmTrust aims to expand its known spectrum as a provider of comprehensive insurance solutions for small businesses — and holistically, Duncan said.
To know what small businesses need, it is essential to understand the problems they face. Regulatory risks in the area of workplace safety and cybersecurity are a priority for Duncan.
“Over the past two and a half years of the COVID-19 experience, we’ve seen businesses caught between sometimes conflicting state and federal rules regarding, for example, vaccination and mask requirements.”
“Small businesses are trying to run a business, and they don’t have a lot of time or resources dedicated to managing a highly volatile regulatory environment.”
“Another example is cybersecurity,” he continued. “As states and the federal government begin to impose obligations on companies regarding how they hold customer data or the security of their websites and other portals, it’s not just good for business to have an extremely secure portal or to be confident in your data retention capabilities, but there is now regulatory risk, including potential financial fines for not complying with this obligation.”
Take care of cyber hygiene
AmTrust offers cyber insurance for major events, but sometimes it’s about helping policyholders manage their cybersecurity hygiene first.
“I think the future is not just in reactive protection, but in using technology to preempt areas of risk in small businesses or agencies, digital assets or IT infrastructure, so that long before a phishing attack happens, you have identified the ways it is most likely to happen.
“Long before a denial of service attack happened, you identified the weaknesses in your architecture and ideally started fixing them.”
One of the ways AmTrust is evolving its product line beyond insurance coverage is to better enable small businesses to assess their websites and systems, and proactively protect themselves.
“Insurance is, by nature, a reactive product, but it doesn’t have to be,” Duncan said. “Just as we engage in loss control for workers’ compensation and help small businesses understand how to better protect their employees so they avoid claims in the first place, we’re looking for ways to do something about it. very similar from a cyber risk perspective.”
Get ahead of reputational risk
Managing their online reputation is also a priority for many small business operators. With voice clients turning to the web to share their experiences with products and services of all types, companies now face significant reputational risk, Duncan pointed out.
“Big small businesses as well as big agencies will not only [hope] for quality engagement on review sites, but actively seek to cultivate the image they want through these review sites,” he said.
“It also means engaging with them. When someone has a bad experience at your company, and inevitably this will happen at the best companies, how you react to it…most importantly, how you react to it on the review site can make it a powerful motivator for the brand, or vice versa, it can harm your brand.
Cultivate a better employee experience
Labor shortages, wage growth, and wage inflation are causing many small businesses to take a closer look at the employee experience they offer. Organizations of all sizes seek to foster opportunities for one-on-one connection and cultivate a quality employee experience.
“In an environment of massive labor shortages that are driving wage growth, wage inflation and a truly competitive labor market,” Duncan said, “the best employers won’t just think about wages in isolation — even though it’s an important part factor – but about the overall employee experience.
“While very large organizations have the resources to invest heavily in the employee experience, smaller companies probably don’t have quite the same level of resources, but they do have a one-to-one connection with their employees,” said he declared.
AmTrust is positioned to provide small businesses with insights on improving the employee experience while cultivating quality customer experiences.
“One way to keep your employees long-term, one way to attract them and keep them, is to make your workplace much more attractive,” Duncan said. Ultimately, this translates into customer experiences.
Provide service at your fingertips
As seamless as digital engagement with agencies managing small business insurance can become, there will be times when a situation is specific enough for a phone call. And carriers working with small businesses need to be able to have someone on the phone to help an agency break down barriers to coverage for their customers.
“Because we are so focused on the small business space, and because we are a relatively young and flat company, agents who do business with us have a high degree of access to all levels of the organization” , Duncan said.
“There are a lot of small agencies where someone goes out and hangs a shingle on a storefront and tries to make their way out into the world,” he said. “We’re barely 25 ourselves and we can sympathize with that entrepreneurial spirit.” &