From The Front Line - Navigating the Storm: Smart Choice's Success in the Challenging 2023 Market
by Carol Drake
2023 has been a historic year for our industry and has challenged us all. 2023 will go down as the year with the most catastrophic storms and losses in our industry, topping 2022 when we made that same statement. We have all felt the effects of inflation personally at the grocery store, and in every part of our lives. These combined effects have made this hard market one of the most challenging in our industry’s history.
Partnership has shown itself to be one of our most important core values at Smart Choice. It’s not just words, it's actions. It's supporting our carriers to help achieve long-term profitability and helping our agents to continue to diversify their business between Personal, Commercial, and Express Markets to fill the needs of your customers.
This strong core belief and years of executing our business diversification strategy have allowed us to achieve some notable results in 2023. We continue to build on our years of consecutive double-digit revenue growth, making 2023 our 12th consecutive year. Prospective agents see our partnership value as well. In 2023, we will have welcomed over 1,500 new agents and are excited to announce we recently achieved the 10,000-member agency mark.
Looking ahead to 2024:
Carriers will remain under pressure to get to a profitable state.
On the Personal Lines side, many of the carriers’ rate increases will continue to move through the book.
Additionally, retention, counseling on risk mitigation, and offering different solutions to manage risk and premium increase will be key. Auto will be the first to recover, but carriers will be looking for the best drivers and your customers will be looking for the best value of coverage for their dollar. That’s where our best agents will begin to offer more telematics solutions. Customers will be open to these driving monitoring apps that will help them offset premium increases. In fact, the direct writers outpace Independent Agents in offering and selling telematics with a take-up rate of 55% compared to 25% for Independent Agents. This presents a huge opportunity for the channel and can help agents retain their best customers. This, along with selling bundled business will help our agents, carrier partners, and ultimately the consumer with the best value and price.
Commercial Lines will continue to be a smart revenue diversification play for agents as we all continue to grow our revenue in 2024. We will continue to see higher premium increases in the property and commercial auto segments feeling the same weather and inflationary pressures as the Personal Lines segment especially in the weather-prone states, while GL will be priced closer to inflationary trends and Work Comp will remain relatively flat.
Agents Program:
Across the board, Smart Choice continues to add new carrier and broker relationships to help our agents with access to markets to place their business.
Our commercially diversified agents will enjoy profit-sharing in 2023 and will expect to see positive results in 2024. Now is the time to reach out to your Territory Manager or State Director to put your diversification plan together.
Smart Start:
Smart Start Personal Lines will continue to support our agents in navigating this tight market by assisting them in keeping up with our carriers’ new underwriting requirements and helping them find the best available market. Smart Start Commercial is known for its ease of placing main street business and now we can boast the successful creation and launch of our transportation unit. Transportation has been very successful in the network, writing over $30 million, so adding it to the Smart Start Program was a perfect next step.
We’ve written over $3 million in new business since its launch in 2023, yet one more reason to call your Territory Manager and/or State Director on how to add Smart Start to your revenue diversification strategy.
Express Markets:
We anticipate this segment to continue its aggressive growth for Smart Choice as the broader insurance market continues its hard market reset, especially for the Property, Home, and Non-Standard Auto Markets.
This segment has grown from $100 million to over $600 million in the past 6 years providing the access and diversification our agents have needed. We have over 40 different broker and carrier solutions in this business vertical at Smart Choice. It includes the segments above as well as wholesale, artisan contractors, and specialty/niche including coverage for cannabis, bonds, and flood.
Smart Choice agents can log in to our Express Markets website using their Business Center username and password or call their local Territory Manager or State Director to find a solution for almost any risk that they encounter.
Final Thoughts:
As you continue to navigate your agency through this hard market, you only have one call to make, and that’s to your Smart Choice Territory Manager or State Director to help you leverage every resource Smart Choice offers, so you too can increase your revenue in 2024.