Being a 'Local' Agent is No Longer Competitive

One of the biggest issues facing many long time agents is the mentality that being a local agent is their competitive advantage.  We hear this most often from captive agents as that has been the rule of thumb for a long time. Is location the reason clients choose your agency over the competition?

The short answer is No.

Your geographic location may get you in the game, but no longer is location a competitive advantage for insurance agents. Why?  Because modern agents know the value of the Internet, smartphones, eSignatures, Google, online policy management, and SSH secure payments.  But above all that, because insurance consumer expectations have changed. We live in a society where everything can be done on our black mirrors instantaneously.  

The way today’s digital insurance consumer builds trust has changed.

Today's consumer is part of the connected generation and doesn’t need to shake your hand to believe you know what you’re talking about. They don’t NEED to look you in the eyes, get a feel for the office, or even hear your voice.

This is how insurance agents, have traditionally built trust.  However, those agencies who desire longevity in the digitally connected world would be wise to consider a new paradigm in the “Trusted Advisor” relationship.

Customer Experience Is the New Local

All hope is not lost.  Just because today's consumer does not need a local agent, local presence can be perceived through Google Adwords, and online marketing sources such as ours.  Modern consumers are looking to find value quickly, and don't need the in-person touch to get that.  Prompt service, and professional values go much further than wanting to go into your office.  Yes, the expense of having an office for consumers to come to is appealing, however how many people do you know actively think to themselves, "I need to swing by my insurance agents' office today"?  You guessed it, nobody.

The modern consumer prioritizes customer experience over local.

In today's economy being local is a bonus, or better put, local is the starting point when searching for an insurance provider. But once upon a time insurance consumers were relegated to only their local insurance providers (due to lack of technology), today these same consumers can reach out to regional, national and even 100 percent virtual agencies to service their insurance needs.  We work with many agents who not only love working statewide, they apply for licenses in multiple states as they build their brand beyond their physical reach.

Why do you think so many agencies were located in the center of towns?  The competitive advantage was convenience.  The problem is, what “convenience” means to the insurance consumer has changed.

There was a time when convenience was judged by how long it took to get to an insurance agency’s office. Today, convenience is gauged using completely different indicators:

  • 24/7 Call Center Access
  • Online Policy Management
  • Mobile Application
  • eSignature
  • Alternative Communication Methods (i.e text message, live chat).

Convenience will mean something different to each insurance consumer, and its very possible location will still factor into the equation.  However, that should not stop you from reaching further through technology!

Local Still Works

I am in no way advocating that “Local” does not matter, or that agents should give up their place in the local community.  That is NOT the point of this article.

No, local is important. Your place in local communities is what makes the insurance professional such a powerful distribution method.

My worry is that as an industry, using “Local” as a crutch for not implementing the marketing and customer experience strategies and processes that the modern consumer demands.

If you rely solely on what served as your competitive advantage ten years ago, you won’t be in business ten years from now.

The modern consumer doesn’t NEED a local provider. If they did, online only carriers like GEICO and Esurance wouldn’t exist. Except that GEICO and Esurance do exist, and are doing quite well.

It’s our job in 2018, by harnessing the power of SEO and creating an incredible customer experience, to help insurance professionals increase their reach statewide, and further to help keep the growth of their agencies.  You can't reach the stars if you're only aiming within your zip code.


Tell us what you think!  Do you market nationally? Statewide?  How has your internal marketing efforts done to expand your reach?

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