5 Business Trends in 2021: How Will They Affect Insurance Renewals?

After a year like no other, 2021 has been full of new business trends that present a mix of challenges and opportunities for insurance agents. Tapping into these overall trends, which could extend into the coming years, can help insurance agents connect with clients beyond just pitching policies. In turn, building this deeper engagement can help insurance agents retain clients more easily. 

In this article, we’ll examine five business trends that could affect insurance renewals in 2021 and beyond. These trends include:

1. Workforces Going Remote/Hybrid
2. Job Openings Hard to Fill
3. Supply Chains Hitting Speed Bumps
4. The New Roaring ‘20s
5. Businesses Rethinking Risk

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#1 Workforces Going Remote/Hybrid

The pandemic forced many workers to go remote, and many have continued to work from home in 2021. Going forward, even when health risks aren’t at the forefront, many will likely continue to work remotely — some will do so full-time, and others will do so on a hybrid basis.

“A hybrid workforce is the future of the work, with both remote and on-site part of the same solution to optimize employers’ workforce needs,” says Ranjit Atwal, senior research director at Gartner, in a press release.

And this trend isn’t limited to 2021. Gartner predicts that 53% of the U.S. workforce will work remotely at least one day per week in 2022.

For insurance agents, this remote/hybrid trend means that business owners will likely need help adapting to new patterns amongst employees, customers, vendors, etc. A remote company may want to adjust their level of property insurance to lower limits, for example, but could want to add a cyber policy to account for the increase in connectivity. In contrast, a restaurant might not be able to operate remotely but needs to account for changes like customers ordering more delivery if they’re not commuting to an office near the eatery.

As you approach customers about renewals, discuss how remote/hybrid work is affecting them. From there, assess whether you can offer helpful advice, even just by sharing how you’ve personally adapted to remote work and what you might be seeing other businesses doing. You can then make suggestions on how to adjust policies to reflect new needs due to remote/hybrid work.

#2 Job Openings Hard to Fill

The pandemic shook up the labor market, and as companies look to rehire staff and grow in 2021, they’re often finding it hard to fill positions.

According to the most recent data from the Bureau of Labor Statistics, the number of job openings in April 2021 reached a record of 9.3 million, while only 6.1 million hires were made. Relatedly, the number of people who quit their jobs also reached a high of 4 million.

The reasons behind these labor market challenges can vary from industry to industry and company to company, so insurance agents should speak with clients about what they might be going through. Restaurants, for example, might be having trouble filling job openings due to many workers looking for more stable employment following all the hecticness they experienced during the pandemic.

Insurance agents can’t solve all these problems directly, but sharing insights on this type of topic could at least make for valuable content marketing, for instance. And when it comes to policy renewals, you may be able to retain clients by talking up the stability that insurance can offer so that business owners can free up time to address other areas of uncertainty, like filling job openings. 

#3 Supply Chains Hitting Speed Bumps

Companies across sectors and countries are often facing slowdowns in terms of getting goods from vendors and delivering products to customers.

“As the pandemic has hampered factory operations and sown chaos in global shipping, many economies around the world have been bedeviled by shortages of a vast range of goods — from electronics to lumber to clothing,” reports The New York Times. But that’s not the only cause for supply chain slowdowns. The New York Times adds that factors like lean existing inventories and severe weather have also contributed to this issue.

So, even when the pandemic ends, supply chains could take time to recover, and unless inventories bounce above previous norms, other shocks to the system could cause future slowdowns. For insurers, this trend could mean that businesses are looking to add further protections as they renew their policies.

For example, business interruption insurance could be useful to some companies who can’t afford further slowdowns. Or cyber insurance could be attractive add-ons to businesses fearing the effects of a cyber attack hitting suppliers, such as with the 2021 ransomware attack on a major U.S. oil pipeline.

#4 The New Roaring ‘20s

Another emerging trend revolves around capacity restrictions being lifted. As more people go out and about, they’re spending a lot of money in the process. While this consumer spending has not been a consistent roar yet, some sectors could see dramatic growth. 

Leading the surge in consumer spending will be services as consumers flock back to their favorite pubs and restaurants, spend on travel and vacations, and enjoy sporting events as they did before the pandemic.

Deloitte

This prospect for economic growth could make renewal conversations easier for insurers. But don’t take these circumstances for granted. One way to help lock in more of these renewals could be to have direct conversations with business owners or put out content marketing that guides companies on how to position themselves to capture consumer demand.

#5 Businesses Rethinking Risk

Although there’s the potential for a strong economic recovery, at least in some sectors, businesses aren’t going to be quick to forget the shocks from the pandemic. Not only do many businesses want to avoid being caught off guard again, but new ways of working, such as more remote work, have heightened risks in areas like cybersecurity. 

“In the post-pandemic world, determining the effectiveness of cybersecurity risk management and operational resilience program is a top priority for risk professionals,” finds a study by MetricStream, a risk management and compliance software provider.

As such, insurance agents should help business owners connect policy renewals with risk management. For example, if clients are worried about staying on track with budgets, given some of the unpredictability in the world right now, you can reassure clients by talking about how insurance can help manage budget risk. And if there are new areas of concern, like cyber risk, see if there’s an opportunity to add to policies.

Be a Trusted Resource

Part of what helps insurance agents be successful with renewals is making yourself a trusted resource to clients. Sharing advice on these types of business trends — such as by interviewing relevant experts to create corresponding blog content or discussing what you’re going through in your own business — can help you build trust and engagement. Ultimately, that can lead to greater client retention.

Making the renewal process easy for clients can also go a long way toward improving your retention. As these trends demonstrate, businesses are going through a lot right now, so you don’t want to make things harder with complex, lengthy renewal processes. Instead, using technology like Wheelhouse, you can streamline and automate the steps needed to complete renewals. That way, you can spend less time in areas like reminding clients about upcoming renewal dates and more time sharing business advice that encourages more renewals.