HEALTH PLAN IQ

AUTHORS


Florent_Moise_headshot_small
Florent Moise 
Principal,
ZS

Peter_Manoogian_headshot_small
Peter Manoogian
Principal,
ZS

Jeff_Traenkner_headshot_small
Jeff Traenkner 
Strategy Insights & Planning Manager,
ZS

Colin_Russi_headshot_small
Colin Russi 
Strategy Insights & Planning Manager,
ZS

Harbinder_Raina_headshot_small
Harbinder Raina 
Associate Principal,
ZS

Paul_Darling_headshot_small
Paul Darling 
Principal,
ZS

Latest Posts

Can Insurance Brokers Like the Carriers They Work With?

Posted by Peter Manoogian on Mon, Feb 18, 2019

iStock_000027049199SmallAs March approaches, “madness” is almost upon us. And I don’t mean just the fun college basketball version, but also a painful one (especially for procrastinators like me): tax season.

Assisted by a well-known software, I completed my filing this past weekend within 90 minutes. At the session’s close, a screen appeared with the question, “How likely are you to recommend [software] to a friend?” The 0 to 10 rating scale signaled that this firm is tracking customer Net Promoter Score (NPS), as it should.

This question reminded me of ZS engagements focused on helping insurance carriers improve their relationships with brokers, especially larger ones.

Many carriers track the NPS for their brokers, and we have yet to see scores that would be characterized as good when compared with other industries. Most scores range between -10 and 40, far lower than the 50 to 70 garnered by customer experience leaders in other industries (think Apple, Amex or Costco).

This triggered a thought: Is it possible for carriers to have promoter relationships with large brokers?

We’ve seen carriers establish strong partnerships with small or independent brokers because they often install programs that enable them to expand their practice to new lines (such as a health insurance broker expanding into P&C). This is also the business model for the increasingly popular professional employer organizations (PEOs), which offer small businesses a suite of HR/benefits offerings.

However, the fundamental business model and value that a broker provides to his or her customers is rooted on the principle of objectivity. Many brokers, for that reason, desire to stay distant from carriers.  

While we would not go as far to say that such a relationship is impossible to achieve, we feel strongly that carriers should use NPS and other such metrics as directional/comparative guides as opposed to a be-all end-all metric to which they manage their business. 

Rather, carriers should consider other actions that can more directly diagnose and influence relationship drivers. Below are four examples:

1. Tailor specific marketing and sales tactics to individual broker attitudes and preferences. Satisfaction drivers for one producer may differ from those of another producer. A robust segmentation of broker firms (and producers) can help inform this.

2. Engage brokers personally through advisory boards or panels to collect feedback and suggestions on a periodic basis.

3. Measure satisfaction for underlying drivers of broker NPS. These could include (but are not limited to) the following areas:

  • Product, such as product breadth and access to health plan personnel (such as underwriting in specific situations)
  • Ease of doing business, including new account setup/enrollment and carrier point(s) of contact
  • Servicing, for example, claims processing
  • Incentives and rewards, such as competitive commissions and broker bonus programs
4. Develop a single measure to quantify the overall health of a relationship. We’ve helped carriers integrate both lagging (new premiums, retention) and leading (contacts, quotes) metrics with survey responses to assess a broker’s position with a carrier. Periodic tracking provides actionable feedback to the many carrier stakeholders who influence the broker relationship.


NPS may not be the ultimate metric to assess broker relationships, but there is no doubt that much can be done for carriers to bring more value to brokers and consequently improve their satisfaction. Those who can identify (and influence) the underlying drivers of satisfaction stand to reap the rewards.

 

Topics: Peter Manoogian, insurance carriers, insurance agents, NPS, insurance broker, broker-and-carrier relationship

Click here to subscribe to Health Plan IQ