CEO on why brokers and agents are ‘stronger than ever’
Brokers and agents are losing significant money as a result of labor-intensive accounting procedures and ineffective back-office procedures. To stop those breaches, one insurance technology is on a mission.
An earlier version of this year saw the release of revenue automation and intelligence software by Comulate, a San Francisco-based software vendor.
According to Comulate, the software automates time-consuming direct bill operations, cutting down broker accounting teams’ human labor by up to 90%.
The program, which connects with the main AMS, CRM, and ERP systems, measures variation and offers real-time forecasts to encourage “revenue integrity.”
The program is designed to address the revenue difficulties faced by broker and agent leaders, according to Jordan Katz, co-founder and CEO of Comulate.
“Firm leaders said repeatedly that they were unable to foresee or monitor deviation effectively. Producers frequently complained that they couldn’t see how and for what they were being paid, which diminished their trust and prevented them from selling and boosting top-line growth, according to him.
“These revenue challenges spider-crack throughout an agency on many levels, necessitating the involvement of production and service teams in the revenue process.”
Insurance’s core distribution system ‘stronger than ever’
Katz explained why he chose to concentrate on enabling brokers and agencies through software after considering the direction insurtech businesses have been heading in recent years.
He referred to the wave of insurtech firms that concentrated on innovation in the direct-to-consumer arena, which had a significant influence on personal lines, as the “‘Insurtech 1.0’ phase, which tackled the distribution phase.
“Why don’t we just cut out these intermediaries, vertically integrate, and improve the efficiency of the insurance process?” But after 10 to 15 years of that trial, it turns out that it doesn’t actually work. Brokers and agencies are more powerful than ever, said Katz.
The CEO noted that the prospects for insurtechs lie in improving infrastructure and efficiencies for intermediaries while maintaining the basic insurance distribution model.
The MGA, the wholesaler, the retail brokers, and the producers, for instance, all communicate back and forth using PDFs, spreadsheets, and pen and paper for one particular cyber policy. Therefore, that one policy will be folded down, and the premium will be split across multiple companies, he said.
According to Katz, the various intermediaries can effectively compute the amount that each company owes the other, find any premium that is missing, and make sure that the accounts receivable are fully funded with the aid of AI (artificial intelligence) automation and software.
“These players can work and operate in much more effective ways, and we can eliminate a lot of the manual tedious work,” he continued.
The prevalence of broker consolidation also highlights the significance of effective back-office technology. Automation will be essential to bringing together data as brokers combine with or buy out other businesses.
As Katz noted, “the policy data lives in multiple different AMS and CRM systems, making it difficult to take several acquisitions and consolidate the back-office, or to have revenue coming in from a carrier.”
What’s next for Comulate?
Katz claims that the Comulate team spent time educating initial clients in the insurance business about the inefficiencies that result in unpaid commissions and labor-intensive accounting procedures.
Coming in as a bit of an outsider really allowed us to see and absorb the suffering that these companies were going through, the man claimed. “Our strong skills in engineering and software products also allowed us to create solutions that raised the bar for what they could accomplish.
“We were starting to have answers to topics that people had been debating for years. It was effective to be able to offer insights into those problems. That gave us a lot of enthusiasm, and it was immediately obvious that we wanted to work with this piece.
Comulate intends to use its current position as a young, agile start-up to its advantage going ahead in order to keep improving its platform.
Katz stated that Comulate sought to be a “modern, curious, and iterative partner” for its clients, adding that the brokers’ back office “hasn’t seen much innovation and is often relegated to tedious pen and paper workflows.”
“We want to focus our future investments and iteration on building tools that further enable the automation at different levels of scale for those firms,” he said.
Have any thoughts about Comulate and the back-office challenges brokers face? Let us know below.
