2021 was an eventful year for auto insurance agents. Consumer driving returned to pre-pandemic levels as accident severity rose to new heights, causing insurance carriers to raise rates to maintain their profit margins. Meanwhile, a major, economy-wide hiring shortage reduced the number of producers agencies had on hand to help them earn new customers.
As we enter 2022, agents will look to preserve and grow their businesses as consumers respond to higher premiums by searching for less expensive alternatives. Here are five predictions for the agent customer acquisition marketplace in 2022.
1. Insurance agents will be just as important as ever
With the growth of direct-to-consumer carriers and the rise of a new crop of digital-first insurtechs, some industry observers have predicted for years that insurance agents will soon become obsolete. However, the events of 2021 made clear that agents will remain an important option for older and younger consumers alike, and that carriers will continue to see them as an important piece of the distribution puzzle.
During the past year, Liberty Mutual expanded its independent agent network with the acquisition of State Auto, a year after Allstate did the same with its purchase of National General. Even insurtechs like Metromile and Root made investments in the independent agent channel this year. In 2022, we expect to see carriers continue investing in agents as part of an omnichannel distribution strategy that enables them to cater to a broad range of consumers with a variety of channels through which the shopper can make a purchase.
2. Staffing will continue to be a challenge, but things are already beginning to improve
In the wake of the federal stimulus checks that followed the outbreak of the Covid-19 pandemic, many Americans chose to leave the workforce. As a result, businesses across the country found themselves staring down a hiring shortage, and insurance agencies were no different. We heard from a number of our agent partners that they didn’t have enough staff to work their leads, and we responded by offering tips on how to continue growing their businesses while understaffed.
As the most recent round of stimulus checks continues to recede into the rearview, we expect hiring to get a little easier as the year progresses. However, staffing will still be tougher than it was prior to the pandemic, and we encourage agents to continue finding ways to work and convert their leads as efficiently as possible.
3. A changing market will bring a renewed focus on efficient, meaningful conversations
During the second half of 2021, carriers looked to become more profitable by filing for rate increases with state regulators and holding back marketing spend as they waited for approval. In times like these, agents and carriers strive to acquire new customers as efficiently as possible, a trend that has been compounded by agencies’ ongoing hiring challenges.
In 2022, we expect agents to place a renewed focus on having meaningful conversations with consumers who are likely to purchase a policy from them. During the upcoming year, agencies will look for ways to stop wasting time and money contacting consumers who won’t pick up the phone or don’t fit their target customer profiles. This means seeking out higher-quality leads and asking their lead providers to deliver new levels of transparency that shed light on where the consumer is in their shopping journey and whether they’re the right fit for them.
4. Calls will continue to grow in popularity
Over the past year, we’ve seen a growing interest among agents when it comes to purchasing calls. When agents purchase a call, they pay to be connected to a live consumer who is on the phone and looking to learn more about buying an insurance policy. This kind of connection saves agents the time they would otherwise spend dialing consumers who may or may not answer their call.
As agents zero in on efficiency in 2022, we expect these time-saving calls to continue becoming more popular.
5. Agents will adapt to digital shopping habits formed during the pandemic
The pandemic was highly disruptive to regular agency life, as consumers were forced to consult with agents online or over the phone rather than at the local insurance office. Heading into 2022, many experts predict that the shift to digital that occurred across the economy will continue, with consumers maintaining the shopping habits they began forming when the virus hit in 2020.
In the coming year, we expect agents to continue adapting to this important shift in how insurance shoppers want to do business. This includes embracing digital marketing tools like email and social media, providing online self-service account management features, and offering consumers the opportunity to meet via video chat as a convenient middle ground between a phone call and an in-person meeting.
Need a hand preparing for the new year? We’re here to help.
As 2022 brings a further shift to digital and a growing focus on efficiency, the insurance agents who utilize a sophisticated and strategic customer acquisition game plan will be the ones who come out ahead. From buying the right leads to executing an intelligent outreach strategy, it has never been more important for agents to implement the best practices for online customer acquisition.
If you’d like a hand developing your own strategy for generating new customers online, there’s no better first step than calling your MediaAlpha for Agents client success manager. Our team of hands-on, seasoned experts will be able to tell you everything you need to know and answer any questions you might have.
And if you’re not already a MediaAlpha for Agents client, we’d be more than happy to speak with you about how our high-quality leads and industry-best customer service can help you find and convert a steady stream of new customers. All you have to do is schedule a meeting with us on our website.