Jane Dotson
Insurance agents can network through various associations and networks, such as the Agent Support Network of America (ASNOA), Smart Choice, and the Big I Alliance. These networks provide resources, support, and advocacy for independent insurance agents, helping them grow their businesses, access carriers, and gain appointments. Networking allows agents to combine their business to qualify for improved commissions and bonuses, share resources, and negotiate more favourable terms. With the rise of digital marketing and alternative distribution channels, networking has become increasingly important for insurance agents to remain competitive and access new markets.
| Characteristics | Values |
|---|---|
| Network Structure | Networks have different structures, such as clusters (self-managed by members) and aggregators (more structured with a wider scope). |
| Purpose | Networks provide benefits like carrier access, resources, advocacy, education, training, and industry connections. |
| Membership | Members may be independent insurance agents or agencies seeking growth, support, and access to carriers. |
| Carrier Relationship | Networks hold master contracts with carriers, managing relationships and providing efficient access to a large group of agents. |
| Misconceptions | A misconception is that agents join without qualifications, and networks exist solely for negotiating leverage with carriers. |
| Competition | Networks help carriers compete and grow in a changing business landscape, especially post-pandemic. |
| Talent | Networks aid in attracting and retaining talent, addressing the challenge of an aging insurance workforce. |
| Digital Presence | Networks guide members in digital marketing and online presence, a critical need for modern agencies. |
| Benefits | Networks offer tools, resources, and support for members to start, run, and grow their businesses. |
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What You'll Learn
Insurance networks vs. insurance associations
Insurance networks and insurance associations are both groups of agents that provide benefits to their members. However, there are key differences between the two. Insurance networks are separate business entities that connect independent insurance members or affiliates with insurance carriers. They hold master contracts with carriers and manage the overall company relationship with them. Networks can provide improved carrier access, increased commissions and bonuses, and agency resources. On the other hand, insurance associations focus on advocacy and representing the interests of their members, which can include insurance agencies, brokers, carriers, and other industry players, at the state or national level. They lobby for legislation, provide education and training, and help create industry standards and best practices.
Insurance networks vary in their structure and function, with some being more structured and managed, while others are self-managed by their members, who combine their volume for a single carrier or market. Networks can provide valuable partnerships for independent agencies, especially in a hard market, by offering improved commissions, bonuses, and access to additional carriers and opportunities. They can also facilitate data-sharing tools, planning, trend identification, and niche opportunities.
Insurance associations, on the other hand, focus on advocacy and representation. They lobby for legislation favourable to their members and provide education, training, and industry standard-setting. Associations ensure that the interests of their members are represented at the state or national level. Examples of insurance associations include Big I and PIA.
Agencies often choose to be members of both a network and an association as they provide different benefits. Insurance networks provide improved carrier access and increased commissions, while insurance associations focus on advocacy and representation. The Insurance Networks Alliance (INA) is an example of an organization that promotes the role of insurance networks and provides resources for agents seeking a suitable network. The INA also adopted the Invest Program, a charity that encourages insurance careers by educating emerging professionals.
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Benefits of joining an insurance network
Joining an insurance network can be an important business decision for an independent insurance agency. Insurance networks, also known as agency networks or network alliances, are separate business entities that connect independent insurance members with insurance carriers.
There are various benefits to joining an insurance network, and these benefits differ from network to network. However, most benefits fall under three main categories: improved carrier access, increased commissions and bonuses, and agency resources.
Firstly, insurance networks bring access to more carriers and, thus, more insurance products. This means that agencies can offer more to their clients and better meet each client's unique needs. For example, Voldico offers instant access to over 50 leading insurance carriers, including the biggest names in insurance.
Secondly, insurance networks can provide improved commissions and bonuses. By combining their business with other agencies, members can qualify for improved commissions and bonuses from carriers. For instance, the Valley Insurance Agency Alliance (VIAA) negotiates at a local and national level to provide enhanced commissions to its members.
Thirdly, insurance networks offer agency resources that independent agencies would otherwise struggle to access. These resources include valuable connections, modern technologies, and support services. For example, ASNOA provides integrated technology solutions that streamline business processes, and Voldico offers services such as payroll processing and marketing, allowing members to focus on selling insurance and meeting client needs.
Other benefits of joining an insurance network include access to a professional network of peers, improved efficiency, and increased scale and growth opportunities.
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Insurance network models
Insurance networks have grown in popularity in recent years, with independent insurance agents seeking to grow their businesses and access resources and support.
There are several models for insurance networks, each with its own unique structure, requirements, and benefits. One of the most common models is the cluster, which tends to be the least structured type of network. Clusters are often self-managed by their members, who combine their volume for a single carrier or market but are otherwise free to operate independently. Aggregators, on the other hand, tend to have more structure and a wider scope, with members potentially combining volume for multiple markets.
The Agent Support Network of America (ASNOA) is an example of an independent insurance aggregator. ASNOA provides a competitive landscape for buying and selling agencies within its network, aligning carriers and technology to maximise members' return on investment. They also offer integrated technology solutions that streamline business processes and provide access to the latest Insure Tech. Other benefits of joining ASNOA include personalised support with accounting, licensing, onboarding, skills development, and ongoing education, as well as access to professional-grade tools such as their agent portal, Atlas, and their commercial rater, Compass.
Another example of an insurance network model is the Insurance Networks Alliance (INA), which was organised to promote the critical role of professionally managed insurance networks. The INA's goal is to create important resources that foster best-practice relationships with carriers, service providers, and peers, maximising the value of insurance networks.
It is important to note that insurance networks are different from insurance associations, which focus on advocacy rather than carrier access. Associations, such as Big I or PIA, represent the interests of their members (including insurance agencies, brokers, carriers, and others in the industry) to governing bodies at the state or national level. They may lobby for legislation, provide education or training, and help create industry standards or best practices. As a result, agencies may choose to be members of both a network and an association to benefit from the unique advantages offered by each.
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Digital marketing for insurance agents
Digital marketing is an important tool for insurance agents to connect with new prospects and find new business. With the recent shift to digital, it is more important than ever for insurance agents to have an online presence and to be able to reach their customers through digital channels.
A survey by BBSI found that 71% of respondents had utilized digital marketing strategies for a year or longer, and 24% intended to start using digital marketing channels. Social media is an important promotional and engagement channel, and insurance agents should be active on platforms such as Facebook and LinkedIn, depending on their target audience. It is also important to monitor engagement to understand what type of content performs best. For example, video posts often work better than image posts.
Email marketing is another cost-effective tool to reach customers, but it is important to consider how the email is assembled. Emails should display well on mobile devices, use rich HTML for the body, and not rely too much on sales-oriented graphics. Text message marketing is another way to connect with customers, but it is important to establish clear guidelines for this channel.
Podcasts are a growing form of digital media, with 162 million Americans having listened to one. They offer an opportunity to reach new audiences and promote brand awareness. Webinars are another way to generate leads and educate customers, with 29% of BBSI survey respondents using them for marketing.
Other digital marketing strategies include building a referral program, which can increase the conversion rate by 71% as people trust recommendations from others. Agencies can also use the redesigned Agency Locator from Travelers to increase their visibility and search rankings. Finally, insurance agents can work with marketing solution providers such as Stratosphere to meet industry standards and grow their online presence.
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Insurance network misconceptions
One common misconception is that agents can join networks without any qualification or participation requirements. This is not true, as professionally managed agency networks do qualify member agents who apply to join, and they also impose quality standards. Networks are separate business entities that connect independent insurance members or affiliates with insurance carriers. They hold master contracts with carriers and manage the overall company relationship.
Another misconception is that insurance networks exist solely to exert negotiating leverage with carriers. This is not the primary purpose, as networks also provide benefits such as data-sharing tools, planning, and identifying trends. Furthermore, networks can benefit carriers by reducing travel and marketing expenses, as they can reach a large group of agents more efficiently.
There are also misconceptions about insurance in general, which can impact how people view insurance networks. For example, some people believe insurance companies intentionally delay paying claims or look for reasons to cancel policies. While insurance companies must follow regulations, there are complexities and variations in policies that can lead to misunderstandings. Finalizing an insurance policy can be a lengthy process, and refunds can be confusing, with penalties for breaking contracts mid-term.
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Frequently asked questions
An insurance agency network is a group of independent agencies that work together to combine their business for one or more carriers. This allows them to qualify for improved commissions and bonuses from carriers, get access to additional carriers or opportunities, and make use of other agency resources as a larger group.
Insurance agency networks provide independent agencies with improved commissions and bonuses, access to additional carriers, and other agency resources. Networks can also provide support and guidance to help independent agencies grow their business.
There are many different insurance agency networks, each with its own unique combination of requirements and benefits. When choosing a network, it is important to consider the network's business model, requirements, and the benefits they offer. It is also important to evaluate the network's performance standards and the quality and quantity of business they expect from their members.
Some popular insurance agency networks include Smart Choice, ASNOA, SIAA, and Goosehead. Smart Choice has been recognised for providing agencies with the tools and resources they need to start, run, and grow their businesses. ASNOA is a fully integrated service and support provider that helps independent insurance agents grow their business.
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