COVID-19 struck forcefully at dizzying human cost, in turn pushing our economy to rapidly cycle from prosperity to a downturn. While we all hope this challenge will be short lived, it is going to be much more difficult for insurance carriers and agents to grow—or even maintain—their revenues in the foreseeable future.

In times of economic crisis, carriers who nurture strong relationships with their distribution networks – Independent Agents — are more likely to thrive.

The word “relationship” means different things to different people. For the purposes of this article, let’s use the definition from

Relationship is a connection, association or involvement.
An association is an organization of people with a common purpose.

What Drives Strong Business Relationships?

When I was a new branch manager, I was desperate to lead the team to profitable growth. I was very worried that if we did not turn things around, we would all be out of work in the middle of a terrible recession. Over 45 families were relying on our payroll.

The responsibility weighed heavily on me as group leader.  Our team had not been able to make an underwriting profit for a couple of years, the economic conditions were a disaster and our premiums were declining.

Oh . . . and our largest agency’s (let’s call them Super Agency) book of business had a high loss ratio and made up a large percentage of our premium volume.

We were ultimately successful in working through this crisis, in part by turning the situation with Super Agency around. How? We developed a stronger relationship with Super Agency by working towards a common purpose. We sought new ways for us to prosper together.

The result was a more profitable relationship for all of us.

What Does the Data Say About Common Purpose?

Our data indicates that Independent Agents crave a shared feeling of common purpose with their carriers. In fact, this is almost as important to them as underwriting and claims.

The following two quotes sum up what we hear repeatedly from agents who work with top carriers.

“Treat the agent as a partner instead of an obstacle to be worked around.” 


“I place all new business within our agency. There is not a single carrier out there that listens to the whole story. Sometimes we do not have the cookie cutter accounts that underwriters want to see. Flexibility and listening are two things that have become a lost art with the carriers. No one is a standout in today’s environment.  Listen, be flexible, do what you say you can do.”


What Steps Lead to Success?

The path of success for the branch and Super Agency did not start out all sunshine and roses.

I remember our first meeting as being rather, in a word, TENSE. Why wouldn’t it be? We started out thinking of ourselves and our own problems. Times were desperate.

On the carrier side we felt we needed more rate. We needed to non-renew accounts with too many losses. We needed to bring in new business that was less hazardous.

From Super Agency’s perspective, achieving our goals meant hurting relationships with their clients and potentially losing revenue at a time when it was extra difficult to replace. Basically, our initial ask would result in them doing more work for potentially less money.

Early in our first meeting, we all questioned our common purpose. We followed a specific process to create a new vision of our common purpose.

  1. We listened to each other’s concerns and focused on each other’s needs to seek common ground.
  2. We established a joint vision of the future and planned together to align our goals.
  3. We had routine follow ups to verify our plans were working and, if not, we made changes.
  4. We helped solidify our relationship through better aligned financial incentives.

This approach was so successful that we expanded it to connect with other agents. We listened to our agents and, to the extent possible, acted on their needs. In this way we were able to grow. By the end of the economic crisis the branch was thriving and, guess what, so was Super Agency.

For other insights into how to achieve a common purpose, we recommend this blog post by Sigma Resource Group.

Key Take-Away

In today’s environment of loss and uncertainty, satisfying agents’ craving for a common purpose is a real opportunity for carriers to create a competitive advantage.