In today's fast-changing environment, one of the most difficult decisions independent insurance agency owners face is selection of their IT systems.

This is due in large part to the vast number of systems out there.

The dizzying array of options has many owners wondering:

1. What types of technology do I need?
2. Which systems should I choose?
3. How much is 'too much' when it comes to technology spending?

Although it isn't possible to find a 'one-size-fits-all' approach to these questions, we are able to dig into them a little deeper by looking at aggregate data from around 100 independent insurance agencies.

What Agency Management Systems are agents using?

Within our sample, we found that Hawksoft, AMS-360, Epic, and EZLynx were the most commonly used agency management systems (AMS).

Over 70% of the agencies sampled used one of these systems.

Why does that matter? Using a popular AMS can make your agency more desirable when it comes time to sell. This is because buyers are often looking to acquire agencies that use the same AMS because it reduces the amount of friction when importing their records.

From a practical standpoint, however, the agency management system you select should be based on your needs. Different AMSes offer different features and integrations. They also come at vastly different price points.

What types of technology are agents using?

According to our data, the most common systems (besides AMSs) at independent insurance agencies are eDocs/eSignature platforms, client texting systems, personal lines raters, and Client Relationship Management (CRM) systems.

The type of systems you implement can influence many aspects of your day-to-day operations

eDocs and eSignature Platforms are systems that allow you request signatures and send documents digitally. These can help your reduce your reliance on paper records, and can also cut down on the time it takes to process new business and changes to existing business.

Client Texting systems allow you to interact with your clients securely via text message. This can enhance you client's experience and promote faster and more frequent communication with your clients.

Comparative Raters are systems that can help you find the best quote for your client across a variety of carriers. Because these systems show you quotes from multiple carriers at once, it can significantly reduce the amount of time you spend manually looking for quotes. Some agency management systems also offer comparative raters as an 'add-on' feature, meaning you can access it right from your AMS.

Client Relationship Management (CRM) programs help keep track of your clients and leads and track their journey through different stages of the sales and service processes. These programs also can serve as a central place for your staff to look up client information and look at past communications they've had with your agency.

Customer Service Portals/Apps give your clients some self-service capabilities, reducing their need for 1-on-1 live customer service.

Online Applications allow existing and prospective clients to communicate their insurance needs quickly and easily. Giving clients the ability to start their application digitally may also help you get your foot in the door.

Online Instant Messaging involves the ability for clients and/or website visitors to message the agency directly, without needing to place a phone call.

How much is 'too much' tech?

The number of different programs you should be using depends strongly on what your agency's day-to-day needs and long-term goals are.

Within our dataset, we found that the number of different technologies used was highest among high growth agencies, meaning that a lot of agency owners are using technology to scale.

If your goal is to grow quickly, you may want to look into adding some programs to your tech stack that can help you achieve that.

Average # of Technologies used v.s. Commission Growth Rate

There was a low correlation between the number of technologies agencies use and their profitability. This means the systems you select and the way you utilize them matters.

Every system should have a purpose, and time should be taken to ensure that these systems are being utilized to their full potential.

Average # of Technologies used v.s. Profitability

Summary

Technology adoption plays a crucial role in insurance agency growth and client experience, but must be strategically implemented. Our data shows high-growth agencies tend to use more technology systems beyond their AMS.

However, when it comes to increasing your agency's profitability, simply adding more technology isn't enough. Agency owners should carefully select technologies that align with their specific operational needs and growth goals, ensure proper implementation, and focus on maximizing the value from each system.