The Impact of Tech on Private Agents

In this episode, our hosts James Benham and Rob Galbraith interview Diane Delaney from the Private Risk Management Association.

Diane Delaney is the executive director of PRMA. She spent more than 18 years in the industry as Head of Sales Training at AIG before joining PRMA.

Her experience includes building an industry-leading High-Net-Worth Sales School designed to educate brokers on advising clients better.

She initially got a job in AIG’s global training department as soon as she left college. They wanted to teach a trainer; she joined as an assistant to training courses.

Diane began her journey shadowing individual trainers until her manager had to retire and offered her the position. That role took Diane to many offices across the US and Canada, which eventually landed her in the private client division which was a very special niche at AIG at the time.

Insurance for High-Net-Worth Individuals

After the 2008 collapse, Diane ended up in PRMA and CIPC.

PRMA is a non-profit association. Their mission is to elevate a movement of highly educated risk management professionals who are protecting highly successful individuals and families.

A private client division is solely personal lines based but insures high net worth individuals with a personal net worth of 5 million and above, so their needs and coverages are specialized.

PRMA is the location that is met to bring together insurance carriers who offer high network products, their independent agents, and service providers and for them to have a location to come to attend events, to network, and to be educated on what’s happening in the industry to do their jobs better.

PRMA was a natural fit for Diane because of her time managing AIG’s sales program.

“There are many clients out there, but we need each other to learn,” Says Delaney, who positions herself as a “supporter of all carriers”.

How is insurtech impacting the private risk space?

“We do have a lot of members more in the service provider space that are offering a number of tools for our independent agents to do their job better”.

Whether it is a system where they can enter a client’s address and it prefills all of their information or those repetitive questions you need to ask for an underwriter or a leak detection system, tech saves independent agents a lot of time to have real discussions with their clients. Then there are other tools, especially on the risk management side from a tech standpoint, that we’ve seen come into this space.

From various leak detection systems to a lot of wildfire tech firms, insurtech is coming into place, along with other providers with only one goal: for clients to protect their homes when offsite and for agents to improve the loss ratio.

“When technology hits the industry they come to us, we’re an easy way to meet the carriers and the brokers, they are the middleman to the client, so we get to learn about the technology, and we put it in front of the clients. There’s no better way for them to do their job”

A New Role for the Clientele

According to Denise, high net-worth individuals tend to live in the highest risk zones, which are unique gorgeous locations but they are becoming uninsurable because there’s too much risk.

So, Independent Agents work with their clients, and their roles must switch as they are going to have to take steps and measures to prevent the loss from happening before they become uninsurable.

Technology is helping clients prevent loss. Independent agents only need to explain it to the clients and how beneficial it is to them.

Agents must know what the best technology is, which benefits it brings to the table, and how to communicate it to their clients.

What’s happening with insurance premiums?

There are a couple of factors, according to Diane.

Insurance companies are losing a lot of money and it’s not just the catastrophes, there are liability losses that are happening after these storms that are squeezing carriers from a certain amount, and at the same time Independent Agents are making a lot of money. Because of many due changes and imbalances, insurance premiums for the client are skyrocketing.

The premiums are bigger, and some of the carriers are trying to balance it, they can’t have the carrier losing money and the independent agent making a lot of money.

One of the factors that influence prices in the high-net-worth niche is the contracts that are being offered. High net worth clients get bells and whistles in their policies that are not available in mass market providers.

Because of rising costs the bells and whistles are coming out of these policies because either the client doesn’t want them, or they are impacting these carriers.

Delaney thinks something must change to get more balance between independent agents, carriers, and clients. She believes the market will transform into admitted and not admitted business and will impact both agents and consumers.