Whether you use it to do your banking or to keep in touch with your family, technology has revolutionised the way we lead our lives. But, while it's now fairly standard to use technology to write personal lines business, it's still much less common in the commercial sector. Insurers must take some of the blame. We were late adopters and many of the early e-trading platforms were clunky and frustrating to use. Thankfully this has changed and systems are now much more user-friendly and intuitive, allowing business to be written quickly and efficiently.
But we now face a new challenge - technophobia. While some brokers in the SME insurance market have taken the plunge, others, perhaps deterred by trying some of the prototype systems, are reluctant to embrace new technology.
As an example, we ran a survey to gauge broker views of technology. It found that, overwhelmingly, brokers wanted insurers to focus on doing a good job of the basics such as underwriting and service, with technology less of a priority.
I've also seen examples of this when I've visited brokers. In one case, the firm had invested in an expensive IT system, only for it to still be sitting in its box several months later.
But not embracing technology is a very dangerous strategy that poses some serious threats to your business. As more and more of your competition moves to e-trading, you risk being left behind. The next generation of customers and brokers are so used to a technology-enabled world, transacting business in any other way will seem slow, clumsy and old-fashioned.
You'll also see increased competition from personal lines brokers. With experience of online trading under their belts, some of the personal lines brokers have developed their SME offerings, using technology to cut the cost of writing business and making them more competitive.
As products shift to the online environment, more and more will become commoditised. Then, just as happened in the personal lines market, competition will also come from the aggregators and direct insurers. Additionally, as margins get squeezed, insurers will start to restrict products to e-trading only. Brokers who don't embrace online trading could find themselves completely frozen out.
Although this might paint a bleak picture if you're nervous about technology, incorporating e-trading into your business probably isn't as scary as you might think. Systems are user-friendly and insurers and software partners are happy to provide support and training to enable you to harness the powers of e-trading.
It's also important to remember that technology delivers significant business benefits. As well as helping you compete, by shifting some of the more mundane tasks online, it will free you up to focus on the more important parts of your business - demonstrating your expertise by providing advice to your clients.
Dave and the FastFlow team will be on the QBE stand, D48, at BIBA 2014 on the 14 and 15 May.