Canadian brokers have a leg up on their counterparts in the United States and the U.K. when it comes to digital transformation, a recent survey finds.
Seventy-three percent of Canadian brokerages say they have a digital strategy in place, and this number has been increasing year-over-year, according to Applied Systems’ 2021 Digital Technology Adoption Survey.
The survey evaluates the level of digital technology adoption by agencies and brokerages, as well as their progression towards digital transformation.
Comparatively, 66% of survey respondents in the United States and 47% in the United Kingdom have adopted digital strategies. Between the three regions, this accounts for a 7% increase year-over-year, although Canada takes the lead, according to the survey released on Jan. 25 and conducted in 2021 Q1.
“I think we as an industry realize the value of digitization,” Steve Whitelaw, vice president and general manager at Applied says on Canada’s lead.
Despite Canada’s lead in one area, the survey also shows that 88% of Canadian brokerages aren’t using standalone customer relationships management (CRM) and sales automation applications, which are used to streamline brokerage marketing and sales.
While the survey finds brokerages with a revenue of $5 million to $9.9 million are more likely to use marketing automation (64%), Canadian brokerages that gross less than $1.25 million are the group least likely to use either technology (4%).
“Whether you’re growth-oriented or not, there’s value in understanding where your sales pipeline is,” Whitelaw says.
“Having that integrated in the broker management system is also really important,” he says, explaining the use of automation software. “So, our people prospects, all the way through to when a broker is actually successful in getting them as a customer, and then having a single view of that available to all people inside the organization.”
Comparatively, 83% of U.S. respondents do not use standalone CRM or sales automation applications, followed by 92% in the UK and 94% in Ireland.
Cloud technology has the highest adoption rate among all regions, according to the survey.
Eighty-one percent of brokerages across all regions host their software through cloud technology. This accounts for a 9% increase in adoption across all regions in the past year alone, and an 8% increase in Canada.
Canadian brokerages with revenue of between $1.25 million and $2.49 million, and those with revenue between $2.5 million and $4.99 million, are the most likely adopters (at 79% and 78% respectively). Canadian companies with revenue of more than $25 million are the least likely to use cloud software, at a 62% adoption rate.
“Insurance is all about risk, and I think part of what cloud brings is a way for our customers to insure their particular systems and their data are protected,” Whitelaw says.
Cloud software is also useful for brokerages and agencies who are working remotely, he adds.
“Cloud allows employees to work at home, work in the office, work on a mobile device, work on a laptop. It allows that ability, in terms of business continuity plans, [that] if something happens and a new restriction is in place and my people can’t come to the office…we can keep working.”
Client self-service portals have seen steady adoption growth across all surveyed regions from a previous 35% adoption rate to 38%, according to the survey.
Canadian brokerages with revenue between $5 million and $9.9 million are the most likely to use a client portal at a 48% adoption rate, followed by brokerages with revenue over $25 million at a 43% adoption rate. Canadian brokerages below $1.25 million are the lowest adopters at 22%.
“Because consumers are changing, brokers have to look at what their business strategies are and how they’re going to realize those strategies, enabled through things like technology,” Whitelaw says.
Digital technology adoption is useful because it provides enhancements for business performance, among other things, Whitelaw says. “It just allows for more efficient operations, more informed business decisions, better insurer relationships and ultimately, a better experience for the customer.”