Large business enterprises have the internal resources or can hire a broker to help them make smart decisions about the types of insurance coverage they need to safeguard their companies. But leaders of small and medium-sized businesses (SMBs) often find themselves without the resources they need to do the same.
No one ever starts a small business with a top goal of buying insurance. In fact, it may feel like the worst purchase they have to make because the best-case scenario is they'll never use this product at all because nothing bad happened and they don't have to make a claim.
The insurance industry's job is to ensure that when they need that coverage, SMB owners have it and paid a fair price for it.
Unfortunately, that doesn't happen enough. Studies show that 75% of U.S.-based small businesses do not have the appropriate insurance coverage for their needs. Another study found that 90% of SMB owners weren't certain they had the right insurance.
One reason SMBs aren't properly covered is that knowing the right coverage to purchase can be challenging. Not to mention, carriers offer seemingly similar products at different prices.
Thankfully, technology can help all customers make smart business insurance decisions.
See also: Win in the Small and Medium-Sized Business Market
How insurance agencies can serve SMB customers with technology
Improve efficiency with intelligent automation to help SMBs take the guesswork out of evaluating multiple carriers
The reality of today's insurance marketplace is that each carrier's appetite for risk and the types of SMB customers they want to serve changes all the time. A leading carrier may have been willing to write a certain type of business in the past but not today.
Independent agents and brokers need to know carriers' preferences in real time so they can match them with customers efficiently. Recommendation engines overlaid with machine learning can help better understand which prospects are best for carriers' current needs. These are updated as preferences change.
SMB owners, on the other hand, want to understand what they're buying, how to make sure they have the right coverage and how to avoid unnecessary coverage. When an owner has to shuffle through 100 carriers with different approaches to the same type of coverage, technology can help them navigate and narrow down their options.
By continually drawing on up-to-date carrier information, agencies can more efficiently get SMBs over the finish line and make sure their businesses are protected.
Automate repetitive work, freeing agents to answer owners' questions
One of the chief benefits of technology is that it lets agencies do the simpler things quicker.
Insurance agents and brokers are able to block and tackle by not requiring agents or SMB owners to enter the same information repeatedly. For example, an owner who previously had to fill out each carrier's intake form can now answer a few questions and see multiple carrier quotes.
Another example: Recommendation engines that identify the right coverages for specific risks can speed customers through the top of the funnel and take pressure off human agents. This frees them to do the value-added work of helping SMB owners understand their coverage and find the best value.
Offer SMB owners more intelligent self-service options
As generative AI evolves and improves, agencies will want to consider freeing time through AI chatbots that can have initial conversations with SMB owners about what coverages they need and what options make the most sense for them.
Many SMB owners are using artificial intelligence tools to make their own businesses more efficient and may appreciate how it can make their lives easier as insurance customers, too.
They can learn more about providers and plans without talking to a representative and have more efficient conversations with agents because they're already better informed.
Personalize communications and relevant content at scale
The reality is that most SMB owners only think about insurance when they initially need to purchase it or at renewal time, so insurance carriers and insurance agents need to be thoughtful about when they reach out to their customers.
Algorithms can help agencies create and deliver relevant content, educational resources and tools that help customers better understand their current policies at renewal and if they need to make any changes to their coverage or move to a new carrier.
In addition, agencies can use data they have or are able to acquire to identify other important events – such as anniversaries, changes in company size, regulatory changes in the SMB's state or emerging risks in their industries – and trigger communications to re-evaluate coverage.
See also: Insurance Industry Embraces Tech, Trust in 2025
Use technology to augment – not replace – expert agents
Finally, one of the best ways to look out for SMB owners is making sure they can continue to have consultations with trusted human experts.
Technology is unlikely to replace humans completely in the insurance chain. Instead of replacing them, it should make them better. Human agents are needed for the important work of providing guidance that comes from deep knowledge and experience.
The goal of any insurance agency should be to provide technology that can get a customer as far along the decision chain as they want. But even when SMB owners are offered the chance to purchase online, they typically get to the buy button and become concerned about whether they're choosing the right coverage. That's when they want to pick up the phone and talk to an agent.
Technology works best when it makes humans on both sides of the equation smarter. It can help customers use self-service tools to get smarter about policies and understand different offerings. It can also help insurance agents have more productive conversations with prospective and existing customers, leading to increased loyalty.
The move toward automation is happening every day
SMB owners may not want to think about insurance, but it can make or break their business if something goes wrong. Thankfully, the insurance industry is embracing technology as a way to help these customers make smarter decisions quicker so they can put their main focus on their businesses.
Technology helps SMB owners become more informed on their own and augments human agents so they can find the right coverage for any customer more efficiently.
The insurance industry should embrace technology and educate their SMB customers about the value it provides, so the marketplace more easily matches buyers and sellers with the right policies and growing companies have the protection they deserve.
