John Amore, president and CEO of Zurich U.S., has a vision not just for his company but for the industry. “I think the industry needs to rebrand itself,” Amore told IJ in an exclusive interview in Zurich’s Dallas regional office.
Zurich U.S., a division of the Zurich North America Corporate Region, which has focused heavily on the property/casualty side, is now bringing more financial service product lines to its Internet platform, according to Amore. These new products include life insurance, accident insurance, some specialty lines, errors and omissions, and other professional coverages.
“We hope that Zurich grows out of its roots in insurance and becomes much more of a financial services firm,” Amore said. “We no longer label ourselves as insurance—we call ourselves a financial services firm, and we want to bring more of that capability to our customers. Of course, there are regulatory issues involved—our agents are not necessarily licensed securities brokers, but the idea is they would have access to the right people so they can become more of a financial services provider to their customer as [Zurich] becomes more of a financial services provider.”
This is not to say that Zurich U.S. will abandon its efforts to utilize the services of independent agents. Far from it, Amore said.
“We have historically and will continue to derive 99 percent of our business through independent agents. That’s where our growth has been and where we see growth in the future—that’s why we’ve invested so heavily in technology for them.”
Technology has indeed been a major focus for Zurich U.S. in the last year. Currently, close to 75 percent of transactions for Zurich Small Business are done through independent agents over the Internet.
“Based on equipment they have in their office, an agent can log on a browser base and rate, develop a quotation, hand it down and issue a policy,” Amore said. “The number of agents in our small business program has grown dramatically over the past two years because of the technology we’ve deployed and because of [agents’] acceptance of it and their delight with it.”
Amore acknowledged that encouraging agents to accept the new technology was a bit of a challenge at first. To assist with trouble-shooting, Zurich established a call center in Jacksonville, Fla., dedicated to helping agents with questions about the online process. “[The call center reps] have the ability to see what the agent is doing, so if an agent gets stuck on an issue, they can call right then and pull up the screen and work on it together.”
Despite the changes wrought by technology, insurance will always be a people business, and that’s where Zurich U.S. must concentrate much of its energy.
“Finding, training, developing and keeping people is the biggest challenge that we have,” Amore said. “To keep the proper level of professionalism you have to be an exceptional employer—you have to keep your people challenged and developing all the time with new competencies and capabilities as the expectations of customers and employees rise.”
To do this, Zurich U.S. constantly recruits new agents and employees and solicits feedback from its current people. “We have agent councils aligned by region that have regular meetings…so we know what type of services they require, what type of products offerings they need.”
Zurich U.S. also conducts a series of half-day seminars around the country every year, which has proven to be a successful way to get new agents to sign up. Last year Zurich did 85 visits, with 75 to 200 agents in attendance at each one.
“We sign up a large number of agents at each of those seminars, which has allowed us to rapidly expand our agent base,” Amore said. “They hear the strategy, they see the technology, we show them our commitment to training, the support that we will give them—so that has really been the driver of our wealth. For the first quarter we had about 40 percent growth in that segment through the independent agent.”
Amore leads the business units under the Zurich U.S. structure, including Enterprise Risk, Small Business, Construction, Global Energy, Empire Fire & Marine, Specialties, Fidelity & Deposit, Warranty, Wholesale and Middle Markets. His position gives him a broad outlook on the property/casualty market. Like many others, he is optimistic about the prospect of a coming hard market.
“For the next two to three years, we will continue to see a hardening market. While inflation itself has been relatively temperate over the years, loss costs have started to grow a bit—predominantly driven by the medical side, but also driven by other elements of loss costs associated with liability, physical damage and proertydamage.
“Costs have start-ed to really drive up—they started a couple of years ago, so there’s been a little bit of a lag, and I think there’s some catch-up to do. Plus there is some contraction going on in the industry that’s also causing the hard market to sustain the next couple of years—companies being bought or going into runoff.”
Property coverages have been a difficult area for Zurich over the past several years, as they have been for the industry as a whole. “That is clearly where we see the most radical change for us in terms of price increase—that has been the necessity for us to get the portfolio profitable,” Amore said.”
There are more concerns building up over the workers’ comp business. We are supporting the efforts to get stability in California’s workers’ comp programs, because there’s an imbalance there. State Fund has been taking on a larger share of business. We’ll fix it through regulation and if necessary, legislative efforts.”
What does the future hold for Zurich?
“The time is right for us to become a significant growth-oriented company,” Amore said. “Because there has been a lot of consolidation in the marketplace, agents and policyholders are looking for someone who can offer the depth that we can.”
That depth means development of a broad set of financial solutions for agents to supply to their customers. “What our agents and our policyholders tell us is they want two things: financial stability and expertise. We try to build the Zurich brand under those dynamics.”
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