Agency Management Applications: Not ready for prime time with Managing General Agents


The technology designed to operate in the gray area of insurance—a space often called wholesale insurance, the purview of Managing General Agents—is quite limited. In my “what kind of technology do you use?” conversations with MGA’s, they tell me it is a mixed bag. Some use off-the-shelf technology products, some use homegrown applications (think Excel and maybe Access), while others use a highly customized application designed for the retail insurance agent or broker. The reasons are many, but primarily the technology gap is due to the limited size of the MGA market, as well as the variety of MGAs and how they manage their businesses. MGAs are not made for a cookie cutter solution.

In our work here at VUE we understand the nuances of MGAs, distributors and specialty agencies and have developed a robust distribution management solution specifically designed for the wholesale insurance market of MGAs and Distributors. Although MGAs have many of the business processes of an agency, they also have business processes of the carrier. As I noted, these unique business processes are not solved by the majority of insurance technology companies, so pretty basic homegrown applications are the norm. Point of fact: I just returned from the 2016 edition of the NAILBA conference and saw some good technology, but most of it was designed for a specific solution such as illustrations, or for straight-thru processing of applications. Very little addressed the area of technology specifically designed to work with the MGA or distributors.

Agency Management SystemOne key differentiator that VUE has is that we invest heavily in the MGA/Distributor marketplace and have developed a solution that manages many of the processes that enable an MGA to compete, and to deliver on services to both the carrier and to the retail agency. For example, in our Distribution Management suite, we offer a module for revenue reconciliation. From a business standpoint, the feedback we get from our clients is that being able to forecast upcoming commissions, splits, overrides, and bonuses is vitally important and clearly solves a major business problem.

Just as agents like to get paid, so does the MGA. In addition to the pay aspect, MGA’s and wholesalers have a very different issue when it comes to CRM software. CRM systems are one area where the technology is useful, understandable, and relatively easy to use. And, it is widely used at the retail agency level since CRM is a very good contact database and was designed for B2C. While the retail aspect of CRM is covered by the retail agency, the carrier side or the distributor side isn’t that easy. For the MGA or distributor, the contact data is similar to how the carrier would use CRM but the distributor or MGA is using CRM as a tool that isn’t just B2C but more like B2B2B2C. That translates to Business to Business AND Business to Consumer. While the nuts and bolts of a CRM application to work within the B2C or B2B environment are very much the same, it is how the particular CRM application will be used when an MGA wants to go beyond the usual contact database and execute a marketing campaign on behalf of its agents. I don’t want to split hairs here, but how the CRM application is licensed can be very problematic for the MGA or Distributor.

For more specific information on CRM, please downlad our NEW white paper: CRM Might be the Swiss Army Knife of Sales Technology


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