Knowledge Center


Knowledge Center Items Podcast Episode 7

Episode 7: Why You Need to Focus on Your Clients More

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The amount of attention you give your most important clients right now could make or break your renewal chances. 

It might sound like a simple task, but things become much harder when the way you conduct business becomes a moving target. 

New technology has been shoved onto the industry and it has demanded we reinvent our traditional client interactions. 

That has the potential to change the client experience forever. 

Ken Crerar, President & CEO of the Council of Insurance Agents and Brokers, shares his thoughts on which direction you should be heading now.

For more Change Insurance episodes, click here.

Full Episode Transcript

Joey:

Mr. Ken Crerar, how you doing today, sir.

Ken Crerar:

I'm good Joey. How are you?

Joey:

I'm doing all right. I'm kind of curious. I was getting ready today and I was thinking, I want to ask Ken this question. Is there something very small, possibly insignificant that you do every day that most would overlook as to be frivolous, but you maybe attribute as to your core getting out the door, being successful and setting you on the right path for the day?

Ken Crerar:

You know, that's an interesting question, especially in light of the fact that we've been sitting at home for the last three months. I would say to you the last three months, I can tell you that the first thing I try to do is get outside for a walk. I think that's had a huge impact on my, maybe it's the sunlight. Maybe it's the vitamin D. I'm not sure what you might refer to it as, but it puts me into the mind frame to deal with sitting in front of a screen and talking with insurance people all day.

Joey:

I'm pretty sure there's some science behind vitamin D. I've heard it's benefits raved over the last couple of months as well. So maybe you're onto something, Ken

Ken Crerar:

Yeah. Well, who knows, you know?

Joey:

What's the duration that were, how long are we walking for? Is it like 10 minutes, 15 minutes [crosstalk 00:01:13].

Ken Crerar:

No, I've got a dog. I've got the dog. So the dog keeps me company and it's about a 30 or 40 minute walk.

Joey:

All right. I was going to say, is there a pet companion involved? Generally, there is. Just a guy walking by himself, might, you know...

Ken Crerar:

No, there's a large white dog. So if you are in Northwest DC and you see a guy with a large white, fluffy dog...

Joey:

It's you.

Ken Crerar:

It's an Italian sheep dog. It's probably me.

Joey:

All right. Italian sheep dog. I don't know if I've ever seen one before. That sounds interesting. But Ken, I got to know, bringing things back a little bit closer to home, where do you think agents need to be paying attention to? What should they be doing to kick start things right now? What should be on their mind? What's the thing that they should be doing regularly to get themselves in the right mood?

Ken Crerar:

Well, I think, it's such an interesting time for everybody, but brokers are trained like Pavlovian dogs to think of one thing: clients, clients, clients. I would suggest to you that that's the most important thing to be watching right now is interacting with your client, touching base with your client. I think because there's a lot of change going on and that change is going to necessitate changes within the organizational structures that we're in. I would say everything's going to be driven by the client.

Joey:

Yeah, it definitely makes sense. Is there anything in particular you're seeing work maybe more so for that client outreach? Is there anything that you're hearing from your agents that's really the right kind of approach right now?

Ken Crerar:

Well, I think everyone is feeling, look, we're all working alone in our homes, surrounded sometimes by kids and dogs and other distractions, but people want to talk. People want to interact with each other. The stories I'm hearing from brokers that are interacting with their clients is that one, it takes longer than they thought. They were doing a 10 minute check in call and sometimes they were on the phone for an hour. It's that human interaction that's been missing, and people want that. People like to talk about things that they know something about. If you really want to get somebody talking, ask them questions about them and what makes them tick. People who are in the business of evaluating risk or working for a company where they're worried about their company and there's challenges in the marketplace, they want to talk to another professional who understands their business.

               The exciting part of the role that an insurance broker plays with a client is that they do understand their business. They have to understand the depth of it and with a certain amount of depth and understanding so that you can modify or at least mitigate for the risk. And that's an exciting kind of person to talk to. It's like talking to a colleague, but not. It's talking to, who's got your best interest in mind, but at the same time is there to help you. I think what I'm hearing is people are having lots and lots of conversations. You don't lose business when you're talking to your client, when you're interacting with your client.

               There's always been in the last and I might take you off into a direction. There's been a lot of discussion in the last, Oh gosh, couple of years about technology and disruption and the role of the broker. And I think the thing to remember is if the broker is focused on the client, if you look at any industry, any industry at all, whether it's retail or construction, it's the client who drives where the business goes. I think that what's happened in the last couple of years has been this ringing of hands. Well, maybe AI is going to take over. Maybe I'm going to be disrupted. Maybe I'm going to, you know what? You don't get disrupted when you're a human. What really has happened and I think this is the excitement.

               You want to know what's exciting coming down the road, first of all, we weren't nudged towards technology. We've been shoved towards technology and now all of us, it doesn't matter who you are, have really had hands on experience on how to deal with technology. And technology is nothing more than a tool. It's the telephone. It's the telephone 50 years ago. And now everyone's got that capability and understanding of how it works and there's less fear there. So now we're going to see adjustments around the business as the client drives it towards a lot of change. But I think we're going to have the experience of being a client is going to change because of this and because of the environment that we're in.

Joey:

Well, Ken, you played right into my hand. I don't know if you knew it or not, sir. The next question I was going to give to you is, like you said, technology or otherwise, how are we going to push forward as a group of agents looking to do things a little bit differently, but still, like you said, I think it gets dramatically over-exaggerated just how valuable that relationship is. Where do we need to go to take it, to make sure that all of that stays intact?

Ken Crerar:

Well, first of all, we're not going to make sure anything stays intact. I'm a big believer that things happen and they happen for reasons. And we just have to adjust, roll with it or get out of the way. I think brokers in particular have a good instinct of how to stay central to whatever's happening. Let's talk about the client for a minute. Let's talk about each of us as clients. How is that changing? How are we approaching the business that we're in and what we're doing every day? How do we think about buying things? We buy things very differently today than we did 20 years ago. Our expectations are higher for ease of use. How impatient do we get when we can't do something online? All of those things are going to be elements of the relationship between a client and a broker.

               And the broker is going to drive the innovation. I've always been a believer that in this industry where the real exciting things happen, it's because of great ideas on the part of brokers. Brokers are the ones that are closest to the client and they know what's happening. They're going to drive the change. So I'm not sure what it's going to look like. If I had a crystal ball and could lay it out to you then I would probably not be doing this job, but I would probably be running a brokerage firm and making a lot more money and all those things and having a lot more fun with clients.

               But at the end of the day, I think this is all about what's going to drive the client. How does the client want to interact with us? How much information do they want? The ease of getting that information? What's the experience like? It's going to be a different kind of relationship, but we have a different relationship with everybody that we deal with. We still go into a gas station every day. We still pump gas, but we don't have a gas station attendant pumping it. Why do we do that still? Because most of those gas stations, or a lot of them, have repair services. So they build the relationship around that. That's where the profitability was. I think that's where we're going to get to. We're going to get to the servicing of a client is going to be different because the client's going to demand certain things.

Joey:

Yeah. You said one of my favorite words, the relationship, right., Ken. I think that's one of the things that dictates the whole thing, right. Is there one aspect, if you had to maybe wager a guess in terms of that agents maybe need to look at that relationship just a little bit differently in terms of what experience or expectation a client is, I don't want to say demanding today, but at some point they're just looking to deal with their insurance in a new way, have a relationship in a different way. Is there one thing that we should be keeping an eye out for?

Ken Crerar:

Yeah. I think the biggest thing that we all should understand is we are advisors. Brokers are advisors to a client. The client is sitting there going, "look, I just want you to take care of this". Especially depending on where you are in the market, but a middle market player, if you've got a CFO or a CEO or a senior leader of a firm, they don't really want to understand how this thing works. They just want it fixed. "Just take care of it for me. I want my balance sheet protected. I want my business protected. I'm willing to pay for it, just do it and make sure I've got the coverages I need." That I think is different.

               The other thing that I think we have to think about is how we package things is going to be different. We aren't going to sell products per se. Oh, there'll always be products in this industry, but anytime you can create a product which commoditizes it, you've then taken that and made it easy for it to be done electronically. But if you, Joey, walk into my business and you know my business and you know the nuances of it, and you're able to protect me because of that, that's a real relationship. And that's what I think brokers are moving towards.

Joey:

Interesting, you kind of broke my brain a little bit, Ken. You say we're not going to sell products anymore? I kind of want you to go down that a little bit more in terms of, is it just from the advisory standpoint? You think we're maybe not going to position it so heavily on those products as being the solutions, as it is opposed to our expertise and guidance as being what they're looking for?

Ken Crerar:

Well, I think we're going to play a key advisory role. On the product side, I do believe ultimately we create the products that we need to move. We create the coverages. Brokers are the heart of the industry when it relates to that. Now it's not our capital. We're still going out to the market and finding places and people who will write the business that we need to have written. But frankly, if somebody is not going to write that business, we've done it in the past. If you look historically, when there's been struggling around a particular line of business, we have figured out ways to get coverages put in place. We've layered coverages, we've created risk retention groups. We've created all kinds of mechanisms. And I think at the end of the day, the brokerage industry will basically make sure that a client is covered in the way it needs to be covered. And it won't matter whether you can find a commercial auto policy or not. If you can't find one, you'll create one. You'll create it in a different way, but it'll have a different set of components to it.

               Now, where does that leave us as an organization? It puts us in a position where we're constantly being concerned about the regulatory process around the business. We want to make sure that our members and that brokers can provide the kinds of products and services that they need to provide to their clients in an efficient way, and not to support in an unfair way some particular line of business or et cetera.

               I think this is a really exciting time in the industry. I think we're seeing the confluence of technology, client demand changing the business we're in. The business of risk is changing and there's more players interested and there's lots more capital out there. So you put that all together and you've got this amazing cauldron of change that's happening. I think brokers are really good at change. They're the ones that are walking into that front door, that client every week or every month and, and making sure that things are okay, and those businesses are all changing too. So we're constantly dealing with that level of change. And that's a good thing.

Joey:

So with all that happening, is there possibly an opportunity that you think is maybe going overlooked or that is emerging, that agents should maybe kind of start paying more attention to?

Ken Crerar:

I think the biggest opportunity that insurance brokers have today is not to be afraid. Don't be afraid of what's going on out there. Don't be afraid of the change. Now, is it going to change maybe how you're compensated or some of the structural issues around how you do your business? Possibly, but at the end of the day, the change is being driven by a client. Who gets left in the dust, but somebody who ignores their client or doesn't catch up with their client. Clients are adapting.

               Think of people who are in the business of writing hotels yesterday versus today. A hotel is a very different place than it was three months ago. As we see the impact of the pandemic having on these businesses, they're going to change the dynamics of that businesses, their liabilities changing. All of the issues are changing and they're going to need good guidance and advice and counsel. That's what our guys do, so the opportunities are everywhere. I think it's one of the most open-ended businesses that anybody as a career could go into, because it allows you to do, almost, to be creative in a lot of different ways.

Joey:

All right, Ken, I got two more questions for you. Talking about all of this change, all this stuff that's happening, I'm kind of curious. I want to bring it a little bit closer to home. How are you guys trying to help facilitate that change across the industry? What do you think is most important? As agents look to organizations to help lead the way, where do you think you guys fit in and kind of dictating that change?

Ken Crerar:

Well, first of all, one other opportunity that's out there that I want to raise-

Joey:

Feel free.

Ken Crerar:

-that occurs to me is okay, before three months ago, what was everyone wringing their hands on? Oh, how are we going to bring people into this industry? Okay, well, this is a really good industry to be in right now. As the economy has shrunk, obviously there's a stability issue, but this is a fairly stable industry. We're used to crisises. We're used to big crisises and we know how to get through them. I think there's a huge opportunity for us to pick up some really talented people who for lots of other reasons, whistles and bells, and all kinds of Christmas tree ornaments and stuff, they went to other industries. This is an industry that takes care of it, your employees.

               It's a good industry to be in. It's a really interesting industry, and you can almost have any other interest and be in this industry and fulfill both. That's one of the things that I think is a real opportunity for both our members, as well as us as an organization, because we've been very focused on that whole employment issue, the attraction of talent, the training of talent, and how you do that. And for example, one of the major changes that's going to affect all of us is we've gotten really good at this virtual thing, or we've gotten a lot better.

               I was listening to one firm talk about the fact that pre-COVID, they had probably, maybe six or eight out of 350 people that were teleworking and they were all part timers. They're projecting 40% of their workforce is going to telework going forward. That's a huge change, but it shows you how what's happened and how easily we moved, we got shoved down a road. I love the idea of being shoved versus nudged because when you're nudged, you don't want to do it, but you do it. You got shoved, you do it because you have to. That's where I think we are.

               Now, as it relates to the organization and what we're doing to, as you say, question change insurance. We're not really. We're about providing the information that our brokers need to understand what's happening in the marketplace. We've been very involved in keeping them aware of the changes that are going on in Washington and the regulatory structures around the country.

               But our job is not to define the model. It's not to define the business. Our job is to make sure that there's no barriers to allowing our members to freely innovate and do the things that they like to do. That's our opportunity. Our opportunity is good, solid information. And that's what we've always focused on. It's the quality of the information. It's our advocacy efforts. Somebody has to make an argument of what is happening. Today what we're doing out there is really just talking about we've have our own relationships. And those relationships have been able to translate into the ability to understand what's going on and what role we play. We had some involvement in the PPP, development of that. And that's all about clients. Our interests there were very simple. Our brokers were interested in their clients and what they could do to be helpful to their clients and that's where we focused our attention.

Joey:

All right, Ken, last question for you, sir. We've talked broadly across the entire industry about a lot of different things, but I'm kind of curious. I want to zero it in very specifically to you. What's one thing that you are really looking forward to, a little excited about, takes you back to when you first got into it, that might be popular, might not be popular. I don't know. I'm kind of curious, what is that thing that really has you at the edge of your seat?

Ken Crerar:

That's interesting, Joey, because I've gotten excited about us taking a hard look at the business. It's time for us to run our own internal planning structure, planning process. I think this is a really exciting business. I think where it's going is exciting and the opportunities that they're ahead. So in order to get there, we've got to go through an internal process of basically exploration and that's what we're doing.

               So when I got into this business, for example, the benefits side of the business was a very small component, almost nonexistent. Today, it probably averages 35 or 40% of revenues of these multiline firms. The concept of a multiline firm didn't exist when I got into the business. There weren't any. Today, most firms have two courses of revenue or two revenue streams. I think that's going to converge to one because I think you're going to have a client as opposed to two clients. But I'm really excited about having that dialogue and that process that we're going to go through to come up with what's the information that's needed so that the next generation of leaders in this industry can build out firms that reflect the needs at the time.

               So that's the excitement. I came into this industry from another industry. I was in the shoe industry and I watched it disappear. To me, it's really exciting to watch this industry. We're in the middle of, what's probably the world's largest health crisis we've ever had probably bigger than the Wars, et cetera. And we're getting through it and we will get through it because we're trained to be able to think like that and to think under these kinds of conditions. So I'm excited about it. I think this is an exciting time to be in this industry.

Joey:

Ken, I appreciate the time, sir. It was a lot of fun.

Ken Crerar:

Thanks, Joey. Anytime.

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