The Who's classic song demands to know, "Who are you?" At a recent summit meeting of agency owners in our Agency Growth Mastermind group, this one question generated hours of intense discussion. While I can't divulge the details that were discussed in these closed-door sessions, I can share some of the new roles and value propositions being adopted by progressive producers and agencies across the country.
From transactional to consultative
The traditional broker's role was transactional, helping the employer purchase medical insurance from a carrier. Brokers essentially have been in the renewal business; but spreadsheeting is now table stakes.
Your challenge is to transition from the obsolete broker role to a new consultative role that brings massive value by solving business problems beyond the renewal. The goal is an enhanced value proposition - supported by a strategically designed portfolio - that allows you to monetize the client relationship, replace the lost medical commission, remain relevant, and position yourself to move to a fee-based model. Successful post-reform benefits firms will be consultative and able to solve meaningful business problems. You decide what types of problems you want to solve and, thus, your value prop to the market.
Although there surely are other options, we are seeing agencies and producers basing their new post-reform advisory roles on one of four cohesive value propositions:
1) Human capital management - This value prop is a logical extension of the traditional broker role with a focus on HR, supporting its mission to manage and optimize the company's workforce. Your solutions might include benefits strategic planning, HR outsourcing and technology, actuarial services, population health management, executive benefits, onboarding, compliance, retirement services and such outside-the-box solutions as compensation strategies and employee training and development programs.
2) HR risk management - Also HR focused, this might include much of the human capital management role but is even more consultative and technical, helping identify and solve risks that undermine or threaten the mission of HR. Includes an emphasis on compliance, employment law, and HR leadership strategies.
3) Financial risk management - Serving the C-suite, this approach leans toward insurance solutions that help clients manage personal and business financial risk, including both P&C and life and health risks. Success with this strategy requires offering a wide range of risk management solutions, including perhaps business insurance such as key-man and buy-sell, worksite voluntary, retirement services and wealth management, workers' comp, and executive benefits, including IDI and LTC.
4) Business solutions - Also focused on the C-suite, this value prop is the broadest value proposition, offering profit-maximizing strategies and solutions to a wide range of costly business problems. This is the essence of consultative selling: driving more top-line dollars to the client's bottom line. Innovative business solutions now being offered include telecom expense audit, cloud computing, and cost reduction of the IT maintenance spend.
The broker role is going the way of the lamplighter, iceman and elevator operator of earlier eras. So tell me, "Who are you?"
Griswold is one of the industry's foremost thought leaders. His Agency Growth Mastermind Network helps agency leaders reinvent their firm in 12 months. Reach him at (615) 656- 5974, nelson@InsuranceBottomLine.com or through 21stCenturyAgency.com.
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