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What Every Insurance Distributor Needs to Know About Agency Management Systems

We sat down with Francois Levasseur, Equisoft’s Vice President, Global Alliances & Acquisitions to discuss what’s happening in the independent insurance channel and how agency management systems are benefiting BGAs, MGAs, National Accounts and advisors.

François is a seasoned executive with more than 17 years' experience in Fintech, at Equisoft, as CEO of Kronos Technologies and at other financial services companies.

Q: What key challenges do distributors face today?

MGAs and National Accounts are data driven businesses, but they operate in an environment that has not fully digitally transformed. They take in massive amounts of data that must be processed, analyzed and acted upon, but in many cases the workflows still involve a great many manual steps. Paper apps are still being mailed to their offices.

They have to be manually entered, then sent on for processing and approval. Tasks arising from the new business intake process (like follow-ups on paramedical issues) are not automated.

In many cases commission payments, claims resolution and customer service are still not as fast, seamless and user-friendly as they could be.

Distributors were hoping that carrier feeds would reduce the amount of manual intervention in their workflows—but so far it’s been slow going.

What distributors are looking for are solutions that enable the automation of more processes, reducing errors and speeding up the workflow. They need easier access to all data in real-time, and more effective solutions for leveraging that data to create world-class experiences for clients and advisors alike.

Related to those data issues, all BGAs, MGAs and National Accounts are seeking to attract and retain more advisors. With the advent of new distribution models, such as robo-advisors, the BGA/MGA's role in policy fulfillment is lessening, decreasing the advisors’ need for that part of the traditional MGA value proposition.

Instead, distributors must find new ways to add-value to advisor businesses as part of an emerging new value proposition that serves the digitally transformed insurance landscape. In the new world, advisors place more value on partnerships with those organizations that can help them grow their business.

Q: Could you explain what an agency management system is and what it does for distributors?

Good distributor management systems give organizations more control over the data and processes that power their business—from carrier feeds to app processing, to underwriting and parameds, to commission payments and automated follow-up activity. They are intended to enhance a distributor’s ability to seamlessly manage all of its day-to-day operations.

For the past 30 years, Equisoft’s AGEman (now Equisoft/centralize) has built a brand that is recognized as a leader in the industry of financial products and services distribution.  Our agency management portal equips MGAs with modern and robust technology, including some unique features like:

Automated application processes

BGAs, MGAs and National Accounts need to be able to process new business from advisors on a daily basis. Our advanced case management workflow speeds up the underwriting process for distributors.

The solution, known as Equisoft/centralize, allows them to enter policy applications, either manually or through a feed from the carriers. They can send those policies through to the carrier and get them approved and in- force—giving distributors the ability to push the process from beginning to end.

Easier commission Payments

Equisoft/centralize also enables insurance agencies to more quickly pay out commissions with less effort. Commission grids in Equisoft/centralize are more complex and robust than any other system out there because of an unlimited number of hierarchies that can be accommodated by the grid.

Within the Agency Management System the distributor can process the commission, and capture all of the required information—then actually make the commission payment directly.

Automatic rate updates

The Equisoft/centralize system is unique compared to competitors because it constantly updates the rates and products coming in from insurance carriers. With other agency management solutions distributors enter an initial rate on set-up, then have to manually track and adjust rates as they change.

With Equisoft/centralize all information from the carriers, including rates, are constantly updated by our team—so it’s hands-off for the distributor, meaning significant gains in efficiency and less user error.

Automated follow-up activity

The Equisoft/centralize solution connects to parameds and carriers through data feeds to advance the underwriting process and keep data up to date. This enables us to automate and speed up processes that can otherwise take a long time to complete.

Equisoft/centralize has a complex set of algorithms built-in that automate follow-up activity. For example, if a paramedical company or the insurance carrier has a missing requirement that’s stopping an advisor from being paid on a policy, Equisoft/centralize creates an automatic task and assigns it to a case manager, as well as sending an email to the advisor to close the loop.

The notification/task goes directly into the advisor portal so the advisor can see it when they log in. Equisoft/centralize can also send text messages to advisors so they can get to a policy being settled in less time.

It makes the whole process of policy management very seamless and ensures that the advisor, case manager and carrier are all working together to complete the case.

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In a nutshell, distributors who use Equisoft/centralize find there is less manual intervention needed to see the policy through to in-force status. Our automations and case management workflow are unparalleled, ensuring our clients can confidently and accurately processes cases all the while providing excellent service to their clients, the advisors.

Q: So, the Agency Management System enhances efficiencies, ease-of-use and the whole advisor experience?

The ease-of-use of the Equisoft/centralize an solution is a huge benefit for BGAs, MGAs and National Accounts. Many distributors, even today, are still getting paper applications advisors are actually mailing them in. Then the agency has to manually enter them.

Equisoft/centralize greatly automates this process, which creates efficiencies for distributors and makes for a better advisor experience.

Data Accuracy

Data accuracy is improved because the Agency Management System is able to check manually entered information against the data feed from the carrier, flag discrepancies and update with the correct data.

For instance, a client identified by the distributor as a non-smoker may be revealed in carrier data as a more than occasional smoker. The carrier data is a source of truth, and so the distributor information can be corrected in real time, meaning, at any point in time, distributors have the most up-to-date data.

Accurate and automated data feeds mean BGA/MGAs spend fewer resources on the day-to-day issues that arise from data management and have more time to focus on growing the business.

And all that data can also generate opportunities for advisors, by highlighting clients who, because of products they have already purchased, may be good candidates for cross-sell or up-sell. For instance, an advisor could be pointed to a client who is still in-force with their Term 20 and might be a good candidate for CI. They give stakeholders a window into advisor books of business and help agents build deeper customer relationships.

Q: Why is integration between back-office and front-end tools important?

The beauty of the cutting edge Equisoft/centralize management tool is that it has been built with an open architecture to integrate well with other solutions. That's consistent with the Equisoft vision--it's all about giving stakeholders access to more data that can make their business more relevant to their clients.

Currently, there is a data integration between different Equisoft solutions which brings information from our wealth sales and analysis solution and our insurance front end tools into the Equisoft/centralize system.

In the future data from other products can be shared with Equisoft/centralize and data from Equisoft/centralize can be used in those other products. Integrating insurance agency management software with our other solutions in this way means Equisoft can bring even more value to BGAs, MGAs and National Accounts.

Q: How does technology influence the evolving BGA/MGA and AGA relationship?

The BGA/MGA-AGA relationship has been going through an evolution over the past few years. Traditionally BGA/MGAs have been the only agency that exchanges data with the insurers. BGA/MGAs take apps from AGAs, input the data into their back-office system and send it off to the carrier. BGA/MGAs and carriers are the ones who manage the approval process from that point on.

The AGA challenge is that they don't have access to their data once it's given to the distributor. They can't easily get policy status from carriers or see what needs to be done to get a policy settled. The BGA/MGA owns all the data and AGAs are challenged by that because they want autonomous control of their data so they can manage compensation and pay commissions, etc.

They still need BGA/MGAs for many reasons the carrier connection, compliance oversight, etc. but AGAs have even gone so far as to re-enter application data into their own back-office systems after sending an app to the agency, just so they'll have access to the data. Obviously, this double-entry of data isn't efficient for anyone. It takes resources away from AGA sales efforts, and adds costs to the value-chain.

The good news is BGAs/MGAs understand the value of a data-sharing partnership with their AGAs and are interested in making it happen. So, the relationship is evolving into something new, and technology is helping to facilitate the transformation.

At Equisoft, we're interested in finding ways to bring all industry stakeholders together and help them meet their needs through data-sharing and collaboration. We're helping enhance distribution relationships by creating an BGA/MGA-AGA data hub, which is offered for free as part of the Equisoft/centralize solution.

This would enable both BGA/MGAs and AGAs to access and leverage the data whether or not the BGA/MGA uses Equisoft/centralize as their back-office, so long as the different back-office vendors give their consent.

It's important to point out that this type of data-sharing doesn't mean the BGA/MGA relationship with their AGAs is going to end. AGAs are already double-entering data today. By streamlining and automating those inefficient, manual workflows BGA/MGAs make it possible for AGAs to spend more time and effort on increasing sales.

We feel it's in the best interests of all stakeholders, from carriers to BGA/MGAs to AGAs to back office vendors, to understand the importance of data-sharing and take the steps necessary to enable BGA/MGA and AGA growth.

Q: How does Equisoft contribute to the digital transformation of the independent insurance channel?

Equisoft has been a source of innovative insurance software solutions for the life independent distribution channel for the past 25 years. Adding Equisoft/centralize enables us to bring our expertise, commitment and innovative solutions to BGAs, MGAs and National Accounts.

It will enable us to service the independent insurance agency market through the core part of their business, how they process cases, how they manage policies and how they manage their relationships with their advisors.

Equisoft/centralize is a very modern, rules-based solution. That makes it a perfect fit within the Equisoft suite of products because we're able to integrate it with our digital front-end tools for portfolio optimization, Equisoft/analyze, and with the insurance eApp, quotes and illustrations, and client portals that are part of insurance software solutions.

It is also central to the emerging digital value proposition for BGAs. MGAs and National Accounts, enabling distributors to better partner with insurance agents in the success of their practice.

It identifies opportunities for advisors, removes obstacles in the processing of new business, and makes sure they get paid faster. In total, it helps all industry stakeholders achieve the end goal, making their clients' financial goals a reality.

Equisoft/centralize enables us to become that software provider of the future and the trusted advisor within the distribution market because we're providing an end-to-end solution regardless of which part of the policy lifecycle you are at.

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