Why Managing General Agencies MUST Take Ownership of Communication Strategies

Managing General Agencies (MGAs) play a pivotal role in the insurance industry, which has only ramped up in the last few years and shows no signs of slowing.

While MGAs are mostly known for their specialty underwriting, or distribution edge, technically speaking, there aren't many functions an MGA cannot take ownership of. Some MGAs own the entire policyholder experience beyond underwriting. Some issue policies, perform invoicing and billing, and handle claims. For MGAs, each function for which they assume the responsibility, the MGA can add to their compensation agreements. This is great news for MGAs who greatly desire to control, manage, and enhance the policyholder experience from broker to policyholder. Newer MGAs that are more digitally native to the environment understand the importance of this. Here is why all MGAs should seek to take greater ownership and responsibility for the policyholder experience…

The Importance of Customer Experience

What many insurance companies seem to forget is that their prospects and policyholders buy more than just insurance. Between Amazon, Spotify, Apple, Tesla, and many others, buyers are getting a much more intimate policyholder experience than we ever had before the internet. Because of this, today's policyholders demand more than just a policy; they expect a personalized and efficient experience throughout their journey. Insurance carriers have struggled to deliver on this, but this can be much different for MGAs.

From policy issuance to ongoing communications, MGAs can differentiate themselves by enhancing interactions with policyholders. A well-thought-out communication strategy can build trust, improve satisfaction, and strengthen loyalty. A thoughtful communication strategy that genuinely connects with policyholders stands out in a market where most do little more than the basics.

Policy issuance and renewal, for instance, is a critical touchpoint where MGAs can showcase their commitment to efficiency and transparency. The vast majority of non-claim calls to support staff occur around renewal time. There is confusion, anxiety, and misunderstanding. Sometimes there is anger (why is my premium double what it was last year?). A communication strategy that addresses the range of emotions a policyholder experiences during a renewal can reduce anxiety, reduce the need for support, and likely drive up loyalty and retention. It is so apparent, but in the whirlwind of day-to-day business operations, what ends up happening is the bare minimum required by regulation. Definitely not a recipe for intimate policyholder engagement.

Stepping Up With Multichannel Capabilities

We are well into the digital age, where multichannel communication is no longer a luxury… it is a necessity. Customers interact with businesses across multiple platforms, including print, email, SMS, social media, and chatbots. MGAs must embrace these channels to provide seamless communication across all these technologies, meeting policyholders where they are. Integrating these platforms into a cohesive strategy ensures that policyholders receive consistent messaging regardless of how they choose to engage.

Personalization is another key area where MGAs need to sharpen their policyholder communication abilities. Generic messages no longer resonate with modern policyholders. By leveraging data analytics and AI tools, MGAs can tailor communications to individual preferences, needs, and behaviors. For example, sending personalized reminders about policy renewals or offering customized coverage recommendations can make policyholders feel valued and understood. This is where leveraging your core systems in real time matters. 

A real-world example we often use is a policyholder who received a notification right before a hurricane about their options for paying premiums during that chaotic situation. The problem is, the policyholder HAD ALREADY PAID THEIR PREMIUM IN FULL!. This notification made the policyholder question whether they had actually paid in full or whether the insurance carrier knew something they didn't. This ramped up the policyholder's anxiety at the time, when they were already quite anxious about having to evacuate. As an MGA, you want to own this engagement and you want to use the technology you have to reduce anxiety…not make anxiety worse. The MGAs that can engage in real time, with real data, can communicate with policyholders in ways that create loyalty, and the financial results will show up as increases in retention.

Owning the Communication Strategy

For MGAs to truly elevate their policyholder experience, they must take ownership of their communication strategies rather than relying solely on insurers or third parties. This involves investing in technology, training staff, and creating clear processes for managing communications. By doing so, MGAs can ensure that every interaction aligns with their brand values and enhances the overall policyholder journey.

Moreover, owning the communication strategy allows MGAs to adapt quickly to changing policyholder expectations or market conditions. Whether it's responding to inquiries more efficiently or addressing emerging trends like sustainability in insurance, having control over communications enables agility and responsiveness.

Conclusion

The insurance industry is undergoing rapid transformation, and MGAs must keep pace by prioritizing their communication strategies. By focusing on policyholder experience, embracing digital tools alongside their print communications, and personalizing interactions, MGAs can strengthen relationships with policyholders and differentiate themselves in a competitive market. Taking ownership of this critical aspect of their business will not only enhance satisfaction but also position MGAs for long-term success in an increasingly policyholder-centric world. You want to be the MGA who owns the policyholder experience. If you don't, that can be a wedge for another MGA or carrier who can own and deliver a positive experience to take that business away from you.