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How Can MGAs Drive Superior Customer Experience and Enhance Retention

22nd August 2024

How Can MGAs Drive Superior Customer Experience and Enhance Retention

MGAs play an irreplaceable role in the insurance sector, and while it’s crucial for them to be on top of all their regulatory and compliance duties, they also need to ensure seamless customer experience (CX) and retention. At the end of the day, customers should always be at the heart of every business decision because without them, no firm would survive. In addition, MGAs need to ensure they’re always treating their clients fairly. According to Forrester, 41% of customer-obsessed firms achieved at least 10% revenue growth in 2023, compared to only 10% of less mature firms…

MGAs play an important role in delivering superior customer experience
Overview

MGAs work hand in hand with insurers and brokers, providing specialised and innovative solutions to support insurance’s overall function and provide value to both trading partners and end consumers . Aside from this, MGAs must ensure that the trading partners they’re working with meet the necessary due diligence checks and that they’re continuously monitored for regulatory and AML changes throughout the customer lifecycle. As well as ensuring safe trade, these compliance measures are crucial in maintaining positive customer relationships and upholding integrity throughout the supply chain. 

In this article, we’ll focus on the importance customer experience and retention play within MGAs and the insurance sector, the challenges around MGAs’ customer experience delivery, and the role of RegTech in enhancing customer experience.

The Importance of Customer Experience and Retention among MGAs ​
The Importance of Customer Experience and Retention Among MGAs

Customer experience and retention play a pivotal role among MGAs, particularly given their expertise with offering niche insurance products and their top-notch underwriting capabilities. Not to mention that MGAs are recognised for being early adopters and usually embrace technology and cutting-edge software faster than the rest of the insurance market which helps ensure durable efficiency and customer satisfaction.  

Moreover, MGAs take care of customer service of the policies they underwrite, which makes them a major customer experience accelerator and ultimately reinforces their relationship with both insurers and policyholders. However, this is only facilitated by turning to the right technology provider that can help centralize MGAs’ information and provide real-time access to data faster.. In addition, MGAs can prevent risk and support their customers in navigating the intricate risk environment by taking advantage of new innovative SaaS solutions and other emerging technologies that help them stay ahead of competition and focus on delivering superior value. 

The 4 Main challenges surrounding MGAs’ customer experience delivery​
The 4 Main Challenges Surrounding MGAs’ Customer Experience Delivery

Many MGAs still struggle to deliver a positive and modern customer experience. Compliance and due diligence requirements create friction, impacting the overall customer journey. Back in 2020, a survey carried out by Aventus and the MGAA has unveiled that less than 50% of MGAs offer a “modern customer experience”, and 58% said they don’t have a clear view of their customers on their IT platform. Although it may seem like a long time, it’s only four years ago, and MGAs are still experiencing the same struggles. 

Below we break down the four challenges MGAs struggle with the most when it comes to offering superior customer experience:

1. Compliance and regulatory burdens 

MGAs are compelled to navigating a complex web of regulations that change depending on the region and the type of insurance they offer. This requires them to constantly be on the lookout for frequent updates to always ensure they’re compliant. This unfortunately slows down business and affects their ability to deliver superior customer experiences. Particularly, the FCA and other regulatory bodies are constantly updating their existing laws and introducing new ones. Not to mention that MGAs are always on regulators’ radar. In fact, REG’s recent research report has found that 75% of participants in the insurance market said that regulatory scrutiny has soared over the last year. This requires MGAs to monitor regularly their systems which can easily disrupt customer interactions if the right technology isn’t leveraged. 

2. Data/team siloes and fragmentation 

Many MGAs use multiple, unintegrated systems for managing customer information, leading to data silos and hampering their ability to provide a cohesive customer experience. While MGAs are known for adopting new technology, many are still relying on outdated processes to collect data on both their trading partners and customers. Moreover, the proliferation of inconsistencies in customer data across different software leads to errors and miscommunications, which in turn creates siloed teams, negatively impacts customer trust and satisfaction and leads to severe revenue losses. Therefore, MGAs can only make better and faster underwriting decisions if they have access to real-time and good data. 

3. Limited resources and budget

While established MGAs have a big budget to spend on advanced technology and dedicated SaaS, the smaller agencies tend to struggle. Resource constraints generally hinder MGAs from delivering top notch customer experience because it prevents them from leveraging the right technology, train their staff and implement efficient operational processes. With tight budgets, MGAs may also struggle to meet the necessary regulatory requirements as they don’t invest in the right affordable SaaS provider that takes care of it all automatically. In fact, 45% of the insurance market confirm that compliance costs are the biggest challenge in meeting regulatory requirements and this takes a substantial toll on MGAs’ ability to be customer-centric and retain their existing clients. 

4. Constant changes in customer expectations

Customer expectations are constantly changing, and MGAs are not exempt from adapting to their clients’ evolving needs. As a result, the latter are compelled to develop their business operations accordingly, but also to strive towards seamless customer service and experience. According to the research report “The Road Ahead: An Insight into the Carrier Industry in 2023” carried out by Gallagher Basset, 35.7% of their respondents said that “changing customer expectations” is the main challenge they face today. Particularly, they’ve confirmed that “customers expect their partners to add value through risk management tools and innovative technology-based solutions” and “customers expect more risk insight and risk management related services.” While these are only some of the emerging expectations luring the carrier industry, MGAs work closely with both brokers and insurers, so they always need to be one step ahead to ensure they deliver the best customer experience they can. 

RegTech can help MGAs achieve customer experience success by facilitating data integration, leveraging automation and ensuring safer trade
So How Can RegTech help MGAs achieve customer experience success?

RegTech offers innovative onboarding and lifecycle solutions designed to support MGAs in navigating the regulatory landscape. By automating compliance tasks and enhancing due diligence processes, RegTech frees up resources for MGAs to invest in improving customer experience. But let’s explore the different ways RegTech can help facilitate customer experience delivery:  

Data integration and analytics

RegTech allows MGAs to integrate their CRM data with our SaaS solutions to streamline all their workflow by efficiently transferring all their customers' data between applications, which significantly enhances their productivity and ability to deliver higher customer experience. In fact, our APIs can assist MGAs in creating personalised customer journeys that amplify their clients’ overall experience. This will only increase their satisfaction and encourages them to repeat business with MGAs and spread positive word of mouth with the rest of their stakeholders.

The power of automation

RegTech automates MGAs’ onboarding and regulatory processes. In that sense, our solutions enable MGAs to assist their customers faster instead of wasting a huge amount of time on compliance checks and agency application processes, reducing the overall regulatory burden. Moreover, because RegTech automates information exchanges, MGAs can eradicate the use of spreadsheets, onboard their partners faster and focus on what matters the most – delighting their customers. In fact, one of our customers, CNA Hardy says: “The REG Network has helped us to dramatically improve the efficiency of our broker onboarding process, oversight and customer experience.”

Ensuring safer trade

Relying solely on manual processes to review and monitor trade partners, including carrying out due diligence checks, and AML screenings is inefficient and will only compromise MGAs’ ability to build lasting relationships with their customers. This takes a toll on how safe trade is between MGAs and their partners and ultimately prevents them from serving their customers right. RegTech solutions are all about safety and are designed to help MGAs overcome the complex regulatory environment they’re faced with so they can focus on maximising their clients’ experience.

"The REG Network has helped us to dramatically improve the efficiency of our broker onboarding process, oversight and customer experience"
CNA Hardy logo
Andy Clements Head of Distribution, Sales & Marketing
MGAs must regularly obtain customer feedback to understand and meet needs, enhancing customer experience and retention. RegTech technology helps MGAs comply with the Consumer Duty law by streamlining regulatory processes.
The role of Consumer Duty and Fair Value Assessment in accelerating customer experience

The Consumer Duty law, which the FCA launched on the 31st of July 2023  is a strong enabler of superior customer experience. With this law, financial firms, including the insurance sector, must ensure that their products and services provide fair value. In fact, these firms are required to support their customers to the fullest, making sure their needs are met. MGAs are accountable and responsible for complying with this new regulation, especially that the FCA will be regularly monitoring how companies leverage data to show they’re compliant and will scrutinise fair value assessments for insurance solutions. 

A major requirement of complying with the Duty is to ensure MGAs do whatever it takes to understand customer needs through obtaining regular feedback around the areas that need to be improved. As much as it’s a Consumer Duty law requirement, clear communication with customers enhances customer experience and retention too. And even if MGAs will be compelled to adhere to Consumer Duty, it will automatically facilitate customer experience. RegTech technology enables MGAs ensure they’re complying with the Duty by streamlining all their regulatory processes, leaving nothing to chance. 

With the use of the right technology, MGAs can focus on delivering top-notch customer experience
Conclusion

By leveraging the right technology provider that alleviates the regulatory and compliance burdens, MGAs can focus on building stronger customer experiences and relationships, which will prevent customer churn in the long term. While acquiring new customers is key, retaining existing ones is even more important to build a loyal customer base that trusts and values MGAs expertise. RegTech’s innovative SaaS solutions are here to support MGAs in every step of the way. By partnering with us, MGAs can centralise all their data and streamline their everyday tasks, enabling them to offer seamless customer experiences.


Speak to one of our experts to learn how REG Technologies can help you.

This article was published by:

Article author:

picture Nathan Banfiield, head of customer success at REG Technologies
Nathan Banfield

Head of Customer Success

Nathan Banfield is the Head of Customer Success at REG Technologies. Nathan is passionate about bringing the best service to our customers and strives to help them run their business Faster, Smarter, Safer.

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020 3946 2880

info@reg.uk.com

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