Auto Insurance Agents Consider Impact of Recession on Industry

Young professionals at conference table

At a recent gathering of leading insurance industry figures known as the Big I Young Agents Leadership Institute, the topic of discussion was the broader economy. A panel of industry CEOs talked about the problem with more than 100 young agents, representing their profession’s next generation.

The various panels and discussions covered many of the challenges faced by all segments of the insurance industry, including problems with the current soft market and the opportunities presented by new technologies like social media networks. Social media like Facebook have proven to be invaluable marketing channels in recent years, helping car insurance companies and others to weather the down market.

The Fireman Fund’s senior vice president, Darryl Page, said that “the role of independent agents creates huge opportunity to add value when times are tough and economy is tight. The economy has had an impact across all segments – the affluent segment has been immune, but we are now beginning to see [the impact] there as well.”

Many of the participants at the institute questioned the conventional wisdom about broader economic trends.

Met Life home and auto insurance sales distribution senior vice president Paul Lonneman said “we are all being told that the recession is over. But has anyone seen any indication that it is over?”

Progressive national agency distribution leader Karen Barone agreed, saying “there are two indicators that would suggest we’re seeing some shift. On commercial lines side if we see sustained growth in employment; and on the personal lines side, if we see increased consumer confidence. We haven’t seen those yet.”

A number of industry figures, however, see an opportunity in the crisis for independent agents to position themselves as a better option for consumers, as opposed to larger, more generalist agencies.

Some suggest that such smaller groups could be better-positioned to make it through the lean times than their larger peers, thanks in no small part to their more responsive nature, better ability to quickly detect new trends in the market, and stronger knowledge of the risks inherent in a given specialization.

About John Pirro
John Pirro is a licensed fire and casualty insurance agent specializing in various aspects of the auto insurance industry. He worked in the auto body repair industry before taking a reporting position at Online Auto Insurance News.

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