Why Analytics Can Make or Break Your Agency

When you're looking at AI and you're looking at automation, a lot of the transactional things are going to be done behind the scenes and done in some sort of automated fashion and potentially, you know, by VAs. And what that means for the account management team and even the production team, a lot of what they're going to be doing is more and more interacting with the client. And so understanding their performance and how to support them and where they're at, those client interactions and having analytics around those client interactions, I think is only going to become more and more important.

Hey, hey, welcome back to The Broker's Voice. Andy Neary here, CEO and founder of Complete Game Consulting. I am excited today, we are highlighting another great product in the insurance industry, Premium Logic. I've got with me Todd Daly, president and COO of IMG in Indiana. Todd, welcome to the show.

Thank you, Andy, glad to be here. Appreciate you having me.

I'm excited, uh, I'm excited to learn more about Premium Logic if I'm being honest with you. So We're going to highlight a, a solution you built from the inside, and, and I know you're going to share a little bit of your background even before you got to IMG. Um, but I have to imagine, Todd, you didn't wake up one day saying, hey, I want to build a software solution. Uh, there was probably some kind of frustration going on inside IMG that led you to build Premium Logic. Share that story, if you will.

Yeah, I would say that's a fair assumption. And to your point, I think the relevance of this kind of goes back to Before I started IMG, I spent the first 11 years of my career at Liberty Mutual Insurance. So I had all of the data and analytics that I could ever dream of, whatever insights I needed to run the department and organization. But when I took the leap to the agency side, I was exporting 45-column spreadsheets from these agency management systems, and it was just a nightmare getting the analytics that I needed to, to really drive profitable growth for the agency.

Yeah, I could imagine that. I'm sure you probably had your eyes opened a little bit in that transition. So let's just get right to it. Like, Premium Logic, for the listeners tuning in going, okay, talk to me about it, let's just— what is it and what does it do for agencies like yours?

Yeah, at the most basic level, it's a set of analytics and dashboards that really represent the insights needed to drive profitable growth for agencies. Um, I, I would say at the, the very core, that's what it is.

So when you say a little— maybe a little point of clarity— is this something for that it would help an agency executive run his or her own agency, or is it more data analytics to be providing to clients?

Uh, it is for the agency predominantly. We have a few clients that do some custom things for their clients, but predominantly the bulk of what we do is helping agency owners and team members understand the landscape of their agency and their books to drive, yeah, profitable growth.

Where do you see many agency leaders feel like they have good data to run the agency, but the reality is they don't?

Yeah, this probably isn't where you're going with this, but the first thing that comes to mind is I think a lot of times gut instinct is, is relied on a little bit too heavily. And don't get me wrong, as a leader, gut instinct is very important and there is a time and a place for it, and especially when it comes to speed of decision making. But I got to tell you, quick story with our CEO. We were in September and we were looking at the year-end forecast. He thought we would finish between 6.1 and 6.3. I thought that was reasonable. And come to find out, when, when January hit, we ended up at 6.8. And it was wonderful that we were on the right side of that. Yeah, correct. But, uh, really illustrated the gap of kind of where he thought things were and where things really were. So that was one of the very early conversations that got us over the line to decide to go into this analytics platform and build it out. But so that's one piece, you know, more along the lines of the question you actually answered. I would say retention is one, and it isn't so much that I can tell you for sure that, that people have bad retention data, but what I've found in conversations with agency owners and leaders is most of them don't understand their retention numbers. There's a number being spit out of their agency management system. They're not sure what the calculation is. They're not sure about nuances that may be inflating or deflating that number, but they, they kind of trust it and they have to run with it because that's all they have. So retention's probably—

you know, it's interesting you bring that, this conversation up, like the topic of understanding your numbers. You know, as I run my business at Complete Game Consulting, that's something I find myself obsessing over now more than ever, even down to like, we need to know our marketing numbers, we got to know our sales numbers. And I think to your point, a lot of entrepreneurs and leaders run by gut instinct which, yeah, trust your gut, but guess what? Numbers don't lie. But in this case, if your AMS system isn't accurate, the numbers could be telling the wrong story. When you look at some of the other agency management systems out there, Todd, do you see any areas where they fall short with analytics and data?

I think there's a couple of things that I've learned, and they've done, you know, kudos to the agency management systems. They have done their best to close the gap, but they're not data and analytics companies, right? They're agency management system companies and they're outside of their core expertise that they've been developed over the last few decades. And while they're certainly making progress, I think really truly understanding the business problems and the flow of how problems come up within an agency is just a real challenge for them to, to really internalize and understand as they're building these products. And I would say the other thing, and this isn't specific to agency management systems, but just a lot of software companies in general, Is this one size fits all? Right. And I think that is one of the things that I've learned in this journey is how unique— I mean, I knew as an agency that we were different than some of the national brokers or the mom-and-pop agencies down the street, but I didn't really have a true appreciation for how unique each agency is until we started to get a critical mass of clients and really work with them to develop the analytics they needed to run their agency.

Yeah, I'd be curious to get your, your take on this. So Bringing it back to that moment where you guys were looking at your forecast, right? And you ended up on good news on the high side of being wrong, where you ended up at 6.8 when you thought you were going to be lower. But when you were at that moment where you realized we need to build something, we need to solve this, what led you to make the decision that we were going to build our own solution versus let's go find something that already exists?

I'm glad you asked that question because we tried to buy. That was the easy answer. And so we did a lot of demos. And we did a lot of research and analysis and we found a few things. One, cost prohibitive. They were very expensive. Two, just the intuitiveness. They seemed to be laid out and built by tech companies and software companies. And then the inability to customize. And so we, we beat our head against that wall for at least 6 to 9 months trying to find something. Surely someone has solved this. But those three barriers seem to be true across the board. And I knew enough to be dangerous from a data and analytics perspective. So we decided to go down that path. And, you know, I tapped a few experts from my prior life. And, you know, we— it took time. We iterated over 12 to 18 months. I mean, even living in an agency, there was a lot of collaboration between the different roles, the sales leadership, the operational leadership, our CEO. What are the types of things that they're thinking about and they wanted to see. And it really took, you know, quite a bit of time. And that's where I think, you know, as you mentioned, talking to the agency management systems, they struggle just to have that, that insight and input, you know, to incorporate into their solutions.

It's an interesting time we live in with insurance. I had a conversation with another agency executive last week looking at talking about their forecasting. And you've got the two markets, commercial and benefits, that feel like they're heading in different directions, right? It's commercial is getting soft. So now people are chasing lower rates, whereas the employee benefit market is as hard as it's ever been. I mean, everybody's dealing with bad renewals. And he was talking about how that's impacting their forecasting because where in the past they may forecast 5 to 10% growth on just renewals, now they're much closer to flat because of what's going on, especially in the commercial space. Which is making the data and analytics even that, that much more important. Absolutely. What, what was that moment? Because you guys now, it's not just a solution you offer for you, you have for your own office. This is a solution you are offering outside of IMG. What led you to that aha moment where you're like, wait a second, maybe this isn't just an internal tool, this is something we could actually offer to the market?

Yeah, as I mentioned, we had no intentions of offering anything. We were in a peer group, kind of a mastermind group that gets together in person a couple of times a year. And in those sessions, you know, there's a lot of comparing notes and best practices. And we were sharing, you know, after having built it out, we were finding a ton of value and just were sharing. And their reactions, you know, they were blown away. And I, you know, from not only what the solution was, I was a little bit surprised that they were dealing with some of the same things. I figured it was just kind of our agency. I was coming in, we're from a smaller town in rural Indiana, and I thought, you know, this was— but, but really understanding the magnitude of the problem, that peer group was the first time where we kind of said, huh, you know, I wonder if this could— and not so much I wonder, you know, how much money we could make doing this, you know, on the side, but I wonder how this could help the industry, honestly, especially those small to midsize agencies that I— a lot of your national brokers have teams. They're spending millions and investing in their own analytics tools and teams to be able to offer analytics and insights to the small to midsize agencies was something I just became very passionate about.

I love hearing that. I think a lot of, you know, another conversation I've been having a lot lately is You look at every agency starts at the same size, right, from scratch. And what separates an agency that grows to be $600,000 in revenue to one that grows to be $600 million in revenue? And it's typically the size of their thinking and their ability to put the right systems in place. And other than that, to me, that is what separates those two in many cases. And I think what you're starting to— what you've built is a system that is going to help an agency scale with more confidence and more precision, right? So I'm going to ask you a two-part question, and they're kind of the opposites of each other. Number one, are there certain metrics agency executives look at today that they obsess over that quite frankly really don't matter? And on the flip side, are there any metrics they're ignoring that could come back to bite them in 5 years? So let's start with the Do they obsess over any metrics that, that actually don't matter?

Yeah, I would say a lot of agency owners obsess over lagging measures, and I would say those matter a lot less than leading measures. And what I mean by that, just to define those two, lagging measures are things kind of after the fact. It's how much did we grow? It's how— what was our retention? How many clients have left? Other things that, again, it's kind of a postmortem look at Okay, you know, what happened? I think where, I think a lot of agency owners are growing into is really looking at leading measures, the activities and the insights that are going to predict whether or not a client's going to leave, like a net promoter score, like a post-interaction customer satisfaction survey, potentially digital listening. Looking out, you know, finding a way to incorporate those feedback loops that give them the insights they need before it's too late, before a client leaves or before they don't land the prospect. I think those leading measures and then especially on the sales side, what's the activity? And I think this is an area where there has been a lot of growth maturity in the last 5 years. You're looking at calls, you're looking at, you know, opportunities quoted, you're looking at close ratios. And some of that does bleed into the lagging. But I would, I would talk that in terms of the lagging measures, I think are still a little overhyped.

Yeah, I would agree with you. Even, even when we work with teams on their sales goals, it's often how much did you write versus no, no, what are the activities you're putting in to make sure you hit your sales goals? Um, not— oh, 100%. Flip side, is there anything they're ignoring today that you're like, yo, you, you need to be taking a look at this because this could really hurt you if you're not, if you're not focused on this in the next 5 years?

Yeah, I would say some of the futuristic agencies are really starting to look heavily at phone system data and email data and insights. And why I think that's going to be so important over the next 5 years is when you're looking at AI and you're looking at automation, a lot of the transactional things are going to be done behind the scenes and done in some sort of automated fashion and potentially, you know, by VAs. And what that means for the account management team and even the production team a lot of what they're going to be doing is more and more interacting with the client. And so understanding their performance and how to support them and where they're at, those client interactions, and having analytics around those client interactions, I think is only going to become more and more important to support the team over time.

The agency leaders who have adopted your, um, your system, your AMS, where do you see them getting clarity on how they make decisions about their agency? Because they're now dealing with a, a completely different level of analytics they didn't have before?

Yeah, I would say probably the, the one part that, that I think most use right away that is just kind of that aha is the team member performance, really understanding how producers are performing and how CSRs are performing, and then the ability to sit down and have that conversation without it being a he said, she said, right? It's like, it's just there. There's no one You know, the middleman is like, here's the goal, here are the numbers, or here are the activities, or here's the retention. It's like, hey, let's talk about this, as opposed to, well, I need to tell you your retention's not where it is. And psychologically, there's such a difference in how people react and the productivity of the conversations. It shifts from a, hey, let's look at this data together and figure out how we can figure this out and support you, versus I got to break the news to you that you're not cutting it and you really need to step up.

And I'm glad you said that. We're in the process of finishing up our our training platform we're building that has a lot of AI coaching components to it. And one of the things that we're including in it is data we'll provide to the sales leaders about how people are progressing through the training. And our reason for doing that is kind of along the lines of what you just said. It's not just to identify who's a great fit and who's doing well. It's let's identify the people who aren't a good fit as fast as we can so you can do something about it versus letting those people continue to be inefficient within your organization when the reality is they're probably not a good fit for, for, uh, for your team.

Correct. And, and helping them understand that too, right? And it's not— I think that's one of been the unsung heroes, or, or pleasant surprises, I will say, of this has been, you know, you put platforms in place like this, you know, for oversight, to make sure we're doing the things we need to do. And what's been so awesome is being able to sit down alongside the team members alongside the producers and the CSRs and work on this with them and help them kind of see where they're at and understand their book of business and things like revenue bands where to help a producer see that 80% of their accounts make up 7% of their revenue and how much time that's taking are just those light bulbs go off and it's really fun to to do that again with them as opposed to— I think the natural instinct for these types of platforms is I need to do this to them.

Yeah, that is— it's allowing— it goes back to how we started this entire conversation. Instead of just going off a gut instinct, it's using math and the numbers to tell the truth, to make those decisions. And you're no longer guessing. You've got the data that supports every decision you made. I think every entrepreneur, every insurance leader out there, they have to make that transition at some point. I'm even going through it where it's— you can't just make that decision off a gut instinct anymore. You've got to have the data to say, no, now we're making a calculated decision.

And I would say, I would add, it's a daily battle. I mean, there are, there are things that you kind of want to fall back into habits. It gets convenient to just go with the gut instinct, or there are specific aspects of your role that you kind of tend to go more gut instinct. So it's a, it's a daily battle, uh, to really stay data-driven and take the time and energy needed to get the analytics, uh, and then in order to make them the most important.

I couldn't agree more. Couldn't agree more. All right, I got two more questions for you. Let's start with this. Clients, the ones that have adopted Premium Logic, what would you say they— what do they enjoy the most about using that tool?

I would say it's the, the customization, the ability to customize. And as I mentioned earlier on, I've just been blown away about how unique agencies are and how many different things and just the creativity. It's just been so fun to collaborate with the different agencies and understand how they want to run their agency, what KPIs they look at, and then help bring that to life. They've really, really appreciated that ability to customize and essentially have their own analytics platform that tailors to who they are, where they're going, how they lead, who their leaders are. Uh, that, that has probably been the, the number one feedback.

I love hearing that. So I'm going to ask you to put your thought leader cap on. You, you made the step from Liberty to jumping into a leadership role at IMG. If you were to step into a new agency tomorrow, $10 to $15 million agency, what would be the data you would request right away in the first 90 days to know how the agency is performing and where it needs to go?

I would say the two things that I would want to see first would be what are our clients saying about us and what are our employees saying about us. We haven't talked much about the last, but that is, you know, we subscribe to the if you take care of your employees, they'll take care of your clients. I think a lot of times that can be a little bit of a miss. So to me, those are tier one, and that, you know, what are our clients saying about us in terms of net promoter score or other sort of kind of sentiment analysis or surveys that we're doing. And then the same thing on the team in a combination. And sometimes it's your, your larger employee satisfaction surveys, sometimes it's pulse checks, but a combination of ways that we're capturing how our employees are feeling and doing. Those would be the top two things for me for sure.

If, if there's an agency executive or leader tuning into this episode right now and they wanted to reach out to get a demo of Premium Logic, learn more about it, What, what are the easiest ways to get in touch with you?

Yeah, premiumlogic.com would be the best way to reach out. Always certainly happy to reach out to me at— it's todd@premium-logic.com. So we're in a little bit of transition here of the URL. We have premiumlogic.com. All of our email addresses are still premium-logic.com. So reach out to me directly or go to our website. There's there's a form you can fill out. We'll be in touch within a couple of hours to get that set up.

As someone who runs his own businesses and is at that critical point now where it can no longer be about gut instincts, it's got to be data-driven, confident, calculated decisions. I couldn't be a bigger proponent of some effective agency management system to help you make those decisions. So if you're running an agency today, you want to keep scaling, make sure to reach out to Todd and his team at Premium Logic to learn more, to get a demo. Todd, it's been a pleasure, man.

Well, thank you so much, Andy. It's been great to connect and love what you're doing as well. And yeah, looking forward to staying in touch.

Be good.