Thesis: “Personal insurance sales will remain – but not the same.”
The hybrid agency of the future is not an either/or, it is an intelligent interplay of human and artificial intelligence. And it has the potential to change insurance sales forever.
Why we need a hybrid agency
Insurance sales are facing the biggest changes in their history. A YouGov study conducted with Bearingpoint in 2023¹ revealed that customer expectations with regard to digital advisory services, personalization of the approach and collaboration as well as speed of response are increasing rapidly. Personal contact must not be neglected. Especially in times of increasingly transparent insurance markets and a growing flood of AI-generated content, real, personal contact is becoming more relevant. Many agencies are undergoing increasing consolidation in order to meet today’s requirements in terms of processes, digitalization and increasing customer numbers. In the coming years, the number of agents is estimated to decrease by 25% to 30%². This poses major challenges for agencies and insurers alike.
In addition, many tied agents’ organizations are no longer equipped to actively acquire new customers alongside the growing number of existing customers. In our view, however, this is essential for the future growth of insurers. Insurance in Germany is characterized by strong predatory competition. In order to continue to grow, new customers must be reached and existing up- and cross-selling potential must be optimally exploited.
In our experience, agency staff today spend around 50% of their time on administrative tasks: Queries from customers regarding ongoing claims and benefits, preparing and following up on appointments, IDD-compliant training and regulatory requirements regarding process optimization, data protection and information security. This puts further pressure on agencies that are already fully booked. A hybrid agency that intelligently places AI agents alongside human agents offers an excellent solution to this problem.
What does a hybrid agency look like?
Human agents remain at the heart of a hybrid agency. Unlike in the past, digital agents will increasingly take on routine tasks, particularly at the interface to customers and head office. Digital agents are able to:
- Prioritize customer inquiries
- Prepare talks in the best possible way
- speed up the follow-up process
- and automatically identify good opportunities for up- and cross-selling.
This relieves the burden on brokers and allows them to concentrate on what they do best: Building trust and providing their customers with tailor-made insurance solutions.
The “human agents” are indispensable for sustainable relationship building, advising and explaining the right cover and interpersonal listening, collection and support until a decision is made.
Collaboration between human and digital agents requires a high level of expertise and preparation at the key interfaces: Agency systems, CRM systems and process and workflow automation. This requires a clear understanding of roles and a genuine, active integration of “digital colleagues” into agency workflows.
How this integration succeeds: prerequisites and stumbling blocks
Before insurers start thinking about the technical requirements, it is essential to create an open, AI-friendly culture. First and foremost, this means ensuring trust in the AI applications, creating openness through clear communication of the target image and offering targeted training opportunities for the different “maturity levels” of AI readiness in the agencies. Without a suitable culture, even the best technological solutions will not meet with the necessary acceptance. This is a long-term obstacle to the development of potential.
The technical basis is characterized by various challenges. In addition to the selection of a suitable, regulatory-compliant “AI toolchain”, investments need to be made in the implementation of a data strategy designed for AI readiness. The AI toolchain must be structured in such a way that it can react agilely to changing developments, e.g. through new or improved language models, interface requirements and providers. In the future, AI-based support for intermediaries will be a major part of the competitive advantage for insurers and their agencies. This will also be a key selection criterion when choosing the “right partner” for new or existing agency staff – and thus in the battle for the dwindling pool of the best talent.
How can the use of digital agents in the insurance agency be approached in concrete terms?
In order to initiate the use of digital agents within agencies, it is necessary to start developing and evaluating use cases with all stakeholders involved at an early stage. The first AI use cases have shown that not every use case is always a business case. Together with the sales force, it is necessary to establish a procedure for the evaluation and rapid testing of new use cases.
In addition to involving the intermediaries, all other relevant stakeholders such as the works council, data protection and information security must also be involved at an early stage. This ensures that all projects meet the necessary regulatory and labor law standards and that no showstoppers are overlooked. This would slow down the euphoria and put a strain on follow-up initiatives.
Interdisciplinary workshops with stakeholders are a good way to do this. In addition to developing use cases, they create a real understanding of AI, the basic principles of its impact and possible simplifications. It is important for stakeholders to understand that AI is not the answer to all challenges. Interactive tasks can be used to demonstrate the really relevant task areas for AI in a comprehensible way. This makes the development and evaluation of use cases faster and safer for everyone involved.
Conclusion
Hybrid agencies are not a distant dream, but a project for the next 24 months. Success will come to those insurers that launch pilot projects, create role clarity and proactively involve their stakeholders from sales, operations, technology, the works council and information security today.
¹ Survey: Digitalization of the insurance industry | Giovanni Zucchelli, Sven Gerhardus² Insurance sales 2028: “One size fits all” has had its day | Roland Berger
