Deep Customer Connections, a research and consulting firm, is teaming up with Wells Media on a research project that will be published in Carrier Management in 2015. The topic: Where Should Carriers Invest More—Technology or Agency Relationships?

“One of the things everybody knows is that in terms of that distribution system for insurance, both technology and relationships are really important. What is a little less clear is what is the right kind of balance,” says DCC CEO Nort Salz, whose typical consulting work on behalf of property/casualty insurance carriers is focused on the interactions between carriers and agents.

Salz talked about the impetus for the study during a video interview at the PCI annual meeting in October. The research report, like DCC’s consulting work, will be based on a survey of agents. “They’re the ones who really understand some of the mechanics of the kind of working relationships that we’re trying to help strengthen,” he says, noting that the survey seeks to help carriers understand where they need to focus more resources.

“There’s a lot of money involved. Carriers are spending enormous amounts of money on technology, sometimes, more or less effectively. In a similar way, the people side of the business is also certainly a great asset but it’s a great expense as well. Managing that most effectively is what we’re really trying to figure out,” he says.

As part of the joint survey of agents conducted by DCC in conjunction with Wells Media and Insurance Journal, DCC is asking agents questions about the strength of carrier technology to support them at key points in the customer life cycle—prospecting and generating sales leads, servicing policies, responding to claims, etc. But Salz already has some clues about how the best carriers are doing in terms of technology and other relationship factors based on his firm’s usual consulting work on behalf of individual carriers.

Culture is key, he says.

“At the end of the day, it comes back to a really tough question, which is: ‘How do you build a culture that supports the right kind of technology and also the working relationships?'”

Salz also reveals that based on DCC’s prior work, the firm has found that “at kind of a surprising level, agents aren’t all that interested in technology. They’re interested in the application.”

“Their first question is not ‘Do you have the coolest, latest technology?'”

Instead, it’s more along the lines of “Can you really help me write a policy quickly, and without any errors or problems with it? Can you help me handle a claim quickly? Can you help me do endorsements on other policy service kinds of issues?”

“Of course, technology is insinuated through all of that. It’s ubiquitous.” But agents are “particularly interested in applications and not technology.”

Drawing from more than a dozen years of research about how agents view their carrier partners, Salz says he is skeptical of carriers who are working towards a “no-one-needs-to-touch-this, totally automated kind of approach.”

“At the end of the day, the old wisdom that it’s still a relationship business is in fact, true,” he says, in advance of tabulating the votes from agents from the joint survey.

Still, even Salz’s past research reveals that some carriers come out at the top of the pile in terms of technology. What typically separates the best carriers from the rest of the pack?

“The carriers that are really doing the best have [the concept of] paying attention to agents and policyholders as their guiding light. When it comes down to making decisions, what they really think about is what’s going to work best for our agents and policyholders.”

One of the benefits of the survey is that it will be repeated in a year’s time, he says.

“It’s such a dynamic environment. So things are always changing,” he says. “I used to talk about how it’s like trying to change the tire on a car while the car is moving. I think that now it’s more like trying to change the wing on an airplane when it’s flying. It’s complicated,” he says, referring to the whole notion of trying to move the dial in the right direction on technology investments and, ultimately trying to strike the right balance of resource allocation to technology and relationships.

At the end of the day, “I think what carrier executives mostly need to do is think very carefully about is the kind of culture they’re building.

“What I [should] want as the president of an insurance company is for all of my people to be really thinking about what’s in the best interest of our customers and what can we do individually and collectively to serve those,” he concludes.

Official results of the DCC/Wells Media research report will be available to Carrier Management subscribers in the print magazine and on our website early next year.