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, Author: Craig Fuher

5 Trends in Commercial Insurance for 2022+

Trends in Commercial insurance for 2022+ continue to change. It’s driven by multiple factors like changes in customer expectations, the growth of InsurTech, and new business risks. Keeping up with these changes is important for insurance agents who want to grow their businesses. Doing so can prevent getting passed by competitors.

To keep up with trends in Commercial insurance, agents can stay plugged in through multiple sources. Ranging from social media groups, to in-person networking events, to asking customers more questions during renewal meetings. Not every trend necessarily makes the same impact for each insurance agent. In general, it can help to stay informed.

With that in mind, we’ve compiled a list of five trends in Commercial insurance to keep an eye on in 2022 and beyond.

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1) Agents Emphasize Customer Retention

Agents always look to grow their businesses.  Agents can find success by going deeper with existing customers.  Sticking with them through difficulties can help secure a lasting relationship. Being aware of problems specific to them will help broaden that trust and relationship.

Agency Revolution, an insurance marketing software provider, “predicts that 25% of agents are likely to focus more on customer experience rather than new business to increase referrals and retention.” This is according to Joel Zwicker, in a guest post for PropertyCasualty360.

That’s not to say that agents have to abandon marketing efforts to land new clients. Some might focus more on customer retention than they have in the past. Doing so can make sense business-wise. Customer retention can help you maintain a strong baseline of revenue and then grow. By selling expanded policies to existing customers and getting referrals/reviews from satisfied customers.

2) Customers Get Price Sensitive

Many businesses are facing cost pressures. An obvious hurdle is pandemic-related downturns. Add on dealing with the increased supply costs, managing higher energy prices, or a combination of other factors for an uphill battle. Meanwhile, their own customers are also often dealing with financial issues.

A survey by the International Council of Shopping Centers (ICSC) found that over the past two years, “39% of consumers overall report that their financial situation has worsened. These consumers are now experiencing additional worries around higher prices on essential items.”

Commercial insurers may need to take this trend into account when working with businesses. Tools like Wheelhouse can easily provide rate comparisons and help agents provide business owners with options within their budgets. 

Price sensitivity doesn’t mean that businesses will go with the cheapest option. It’s also possible that agents will be able to sell larger policies to businesses that are more risk-averse now.  That insurance might help these business owners reduce the risk of significant out-of-pocket costs.

It’s worth noting that some economic indicators point in a more positive direction. The March 2022 jobs report from the Bureau of Labor Statistics, shows strong job growth. With the unemployment rate falling to nearly the level it was in February 2020. That’s before the pandemic took hold in the US. 

It’s not as if all businesses and their customers are in bad situations. Their recent experiences may still leave them somewhat price-sensitive and risk-averse. At the same time, some businesses are hiring. A lot. Even if they’re not feeling great about the economy. It could present opportunities to insurance agents. They may need help in areas like workers’ comp insurance to cover a growing workforce.

3) Cross-Selling Heats Up

Another trend in Commercial insurance could be that agents find more opportunities to cross-sell insurance. When selling one type of policy, like workers’ comp, technology is making it easier to also provide other types of quotes, like for general liability coverage. 

Ulrike Deetjen notes in a McKinsey article, “platforms and APIs help insurers connect and use the touchpoints generated to discover cross-selling opportunities.”

Cross-selling could also involve expanding into newer areas, like cyber insurance. Many businesses face increased cyber threats. Price-sensitive businesses may not want the risk of dealing with a breach on their own. So, Commercial agents may find more opportunities to also pitch and quote cyber policies. Thereby helping business owners get the coverage they’re looking for while agents can grow their overall businesses.

4) Technology Continues to Increase Efficiency

One of the more powerful trends in the Commercial insurance space has been technology. It has transformed so many areas. Ranging from insurance marketing, to underwriting, to claims processing. This trend seems likely to continue in 2022. Particularly in terms of technology being used to increase efficiency.

For example, analytics platforms that use artificial intelligence (AI) can help insurers quickly understand large volumes of data. This can then enable them to provide more relevant, efficient service to customers.

“AI can help spot trends before a marketing team or human data scientist can – making sense of enormous volumes of customer data across multiple channels and offering sophisticated recommendations based on past interactions,” notes Duck Creek Technologies, which provides software to the Commercial industry.

Insurers don’t have to just rely on advanced technology like AI. More straightforward technologies, like APIs, can also help increase efficiency. For example, APIs can be used to pull quotes from multiple carriers into one location. This makes it easier for agents to go over options with their clients. APIs can also streamline cross-selling and even extend into areas like lead generation. Using social media APIs that make marketing more efficient.

“The functionality provided by APIs enables you to perform nearly all the social media marketing tasks right within one app, on a neat, well-arranged dashboard,” notes Sociality, a social media management platform.

These areas aren’t necessarily brand new, but they could take on even more prominence in 2022.

5) New Sales Channels Open Up

Lastly, insurance agents and carriers may want to pay attention to more sales channels that open up. Especially with the rise of embedded insurance. Insurers may have to adapt their businesses to deal with new types of competition. New channels emerge for businesses to purchase insurance. That can also mean opportunities to create partnerships with those outside the Commercial sector.

What do these new channels look like? It’s still somewhat early, but the banking sector can provide clues. As the Open and Embedded Insurance Observatory (of which Talage is a part of) notes, a small business might obtain insurance quotes directly through an online accounting platform they’re already using. 

“Today, thanks to the digitalization of insurance functionalities driven by Insurtech companies, every non-insurance company can offer insurance products and services to their customers, in a seamless and frictionless manner,” the Open and Embedded Insurance Observatory notes.

Independent insurance agents might not have opportunities to form partnerships with large software companies. But it’s possible that there will still be ways to embed insurance offerings within partners’ channels. Local agents could team up with lawyers or accountants to provide a more comprehensive service to those forming new businesses. 

Stay in the Loop on Trends in Commercial Insurance

Diving into these five trends in Commercial insurance can help agents find ways to grow their businesses. It’s also important to not get complacent. As you adapt your business, you likely want to stay plugged into new trends so that you can change proactively. That could make it easier to change a little bit at a time, rather than having to overhaul your business to catch up.

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