Relieved Zenefits stopped calling on your group? Get ready for the next wave of online insurance agents.

September 17, 2018

I recently had the privilege of listening to David Reid, the founder and CEO of EaseCentral. His presentation is entitled "Becoming The Feared Competitor" and in it he lays out the new competitive reality for insurance agents who are used to mainly competing with each other in a local market. His message is interesting because he characterizes the insurance business as mainly a lifestyle business. You carve out a book of business, service it and work like crazy to grow your book little by little each year.

 

He goes on to say firms like Zenefits are different than an insurance agency. Its founder Parker Conrad believed much of the value of an agent can be replicated by technology. And technology could be used to take a lifestyle business to a multi-million dollar venture capital boon like Salesforce or Amazon.

 

We all know what happened with Zenefits. It didn't work out because for many reasons. But their demise is no reason for any regional insurance agent to take a deep breath. There is a next generation of folks with signficant capitol looking to leverage technology to replicate and improve up on the Zenefits model. The most impressive of these firms is called Gusto.

 

Gusto is really only operating in a few states but already they are significant insurance producers in California and Colorado. Gusto starts with easy cheap payroll, intelligent marketing and fantastic technology and makes it really easy for a group to name them as Agent of Record. And they are doing it correctly.

 

So what happens when Gusto or another firm like it starts calling on groups in Michigan? I know what you're thinking. There is no way your group would go with a regional insurance agency from Colorado. Well maybe you're right. But what happens when HR turns over and a 30 year old takes over that seat? And you roll in with your 45 benefit folders with five different paper apps to complete at OE? That HR person is going to look at you like you're a dinosaur.

 

The reality is milennials are the largest segment of the workforce in the United States today. They do everything online and they expect their benefits to be online as well. Or at least when someone shows them it is possible, they will be intrigued by it. And it's not just benefits. Logically they are wondering why the entire suite can't be connected--payroll, benefits, PTO, HR.

 

This brings us to the main point, there are technology firms who have emerged who believe the role of the regional agent is pivotal to the ecosystem of employee benefits. These firms know when operating with the same tools as a national technology based agency, there is no reason a regional agent should ever lose.

 

If you are not using a benefit admin system in all sized groups right now, please give me a call. 616.481.8675. We have extensive knowledge with EaseCentral and we have recently engaged Employee Navigator.  We beleive both offer unique opportunities for groups in different segments of the market. 

 

We will help you learn a system, the goods and bads to both and help you move your agency to the necessary next step. Both these systems offer the essential tools and connections for you to "Become the Feared Competitor" as my friend David Reid says.

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