What Is an Agency Management System? AMS Explained
Agency Management Systems (known as AMS) are among the most useful software tools an agency can take on. An AMS is similar to Customer Relationship Management (CRM) software except that they can handle a deeper level of automation.
Agency Management Systems are pieces of software that function as an automation system for an agency at every level. AMS can be customized to function as a system for either life and health insurance agencies or casualty and property-based agencies.
If you've never heard of an AMS, you might be missing out on a major tool you could use to expand and streamline your agency business. Read on to learn more about agency management systems and how to choose one for your agency.
What Is an Agency Management System?
An Agency Management System is a comprehensive, incorporated multi-functional software that can help automate multiple work processes performed by an insurance agency on several different levels.
An Agency Management System does not only operate as software that can track existing customers and bolster customer relations. It can also help to generate new client leads, and it can perform logistics analysis on individual insurance brokers. Here are just a few of the functions that an AMS can help facilitate (Source: AgencyBloc):
Maintaining an accurate dossier of current clients and contracts
Insurance contract option generation so that potential customers can estimate how much an insurance policy will cost them or what policies they're eligible for
Maintaining an accurate data log of client notes, contacts, and other agency-relevant information for the management of the business
Agency Management Systems are useful for moderately-sized agencies that need to wear a bunch of different hats simultaneously with minimal staff as they grow. They're also a good choice for larger insurance agencies that need workflow automation to help keep up with the large amount of data that the agency has to process in its day-to-day activities.
With AMS software, workflows can be automated based on predefined rules of how a business is operated. (Source: Integrify)
Agency Management Systems Are Software as a Service
An Agency Management System is known as a type of software called Software as a Service (SaaS). The objective of these automated software systems is to use cloud-based artificial intelligence to manage an agency's data while also using their database to generate new leads using a broadband connection.
Unlike other software licensing models, where the software license is sold to the buyer and the buyer downloads the software for singular use on their systems, SaaS systems are a delivery model where buyers subscribe to the software service and pay for it on a month-by-month or yearly basis.
While SaaS systems have only begun to really gain steam over the past ten years due to the advent of cloud computing, these applications have been around in their primitive form since the 1960s. In the early days of computing, data companies such as IBM would set up time-sharing or utility-based computer services to allow multiple companies to use their super-computers.
How Do Agency Management Systems Work?
Agency management systems are software systems designed to take a lot of the grunt work out of the day-to-day clerical tasks involved with running an insurance agency. When agents have to perform this petty clerical and research work themselves, thousands of work hours are lost that could otherwise be utilized in proactively improving the company.
From generating sales leads with artificial intelligence algorithms to indexing existing customer databases, AMS software makes it easy for insurance agencies to focus on growth rather than the maintenance of existing processes. It also increases agent productivity and decreases agent stress by preventing them from having to juggle more data than they can reasonably manage.
The foundation of both CRM software and AMS software is the ability to collect and decipher large amounts of digital data in a short amount of time. This ability allows agencies to easily conduct the following tasks:
Generate sales leads: Running a successful insurance company isn't just about keeping existing customers happy. An agency needs to expand with new clientele to remain relevant and profitable. AMS software allows an insurance agent to track a potential client from their first contact to the point that they sign a contract.
Organize book of business: By quickly drawing on a large database of data to aggregate customer information, AMS software can keep an agency's book of business easily organized according to individual contracts. One of the challenges of running an agency is having to keep vast amounts of data easy to access.
Targeted marketing: Data mining customers through an agency management system allows an insurance agency to market specifically to individual consumers based on their needs and habits. Learning how an agency's market behaves also allows them to make proactive decisions on how to offer new goods and services.
Because AMS software depends on AI data analysis to predict market trends and manage current clientele, it becomes more and more efficient the more data it accumulates through use. For this reason, AMS systems only become more valuable to an agency's operations the longer they're put in place.
Another way that AMS software improves the general efficiency of an agency is through familiarity. The longer an agency is allowed to work within the structures laid out by an AMS program, the more productive and proficient each agent should become within the system as they become comfortable with using it.
Agency Management Systems vs. CRM Systems
Agency Management Systems are similar to CRM systems, but they do have some cross-over capabilities. Here are the main ways that AMS software differs from CRM software as it applies to agency management:
AMS is an all-in-one software. CRM systems can sometimes require two or more different platforms and software applications to be used together, which can cause both complications and redundancies. AMS is a single software application that covers every aspect of management that CRM systems cover, but it does it in one service.
AMS is geared specifically towards insurance companies. CRM systems are a more generalized type of service because they are designed to be used with as many different business models as possible. AMS is an industry niche software that is designed around the specific needs of insurance agencies.
AMS has an incredible amount of scope. Because AMS software is designed to automate as many processes within the agency workload as possible, it can handle everything from birthday emails to major policy updates. In comparison, CRM is usually designed to focus on one major aspect of business, such as social media marketing.
AMS can be tailored to individual businesses. Even though AMS software is already customized for the insurance industry, it can also be further customized during setup to offer each agency options that cater to its individual needs based on size, staff,
or clientele.
AMS software may encompass many different types of automated workflows and processes, but all of them are organized with the management of an insurance agency in mind. This makes them a more effective tool for agencies than more generalized CRM systems.
Insurance agents have to collect and organize many different types of data, and insurance is naturally a more data-intensive industry than many other businesses. The nature of the data these agencies collect and use in each claim remains largely the same from contract to contract. This makes it one of the best industries to implement AI-based workflow automation.
How Much Does an Agency Management System Cost?
The price of installing an agency management system can be broken down into two major costs: the start-up cost and the monthly subscription. The start-up cost of an agency management system is typically a one-time fee of $1,000 to $5000 dollars. (Source: Big I Maryland)
Start-up costs of an AMS program can be dependent on several factors, including the following:
The size of the agency that the AMS software needs to be implemented for
The reputation of the AMS software being purchased
Varying costs of bringing in market analysts or software consultants to set up the AMS system and teach the agents how to use it
Once an AMS program is set up in an insurance agency, the agency still has to pay a monthly subscription fee to keep the AMS software accessible. This also grants the insurance agency access to cloud-based computing and web browsers they can use as contracting hubs to interact with clientele.
Subscription fees for an AMS program differ depending on the software, but most subscriptions run between $60 and $100 dollars a month. Agencies also need to keep in mind that they'll have to include overhead costs such as the cost of utilities and broadband Internet to keep the agency management system running.
Even though agency management systems can have some significant costs involved with getting them off the ground, these systems have the potential to save an agency tens of thousands of dollars in payroll over time. They are also capable of generating new business easily through strong sales leads.
Chances are, you'll see any AMS software put into place in an agency pay itself off quickly.
Advantages of Agency Management Systems
The meteoric rise of AMS software in the wake of CRM development is because it offers both insurance agents and their clients access to scenario-specific information that can make processing a claim or setting up an insurance policy more efficient.
Here are some of the advantages an agency can enjoy by implementing AMS software in their offices (Source: Salesforce):
Reduction of operator errors: Automating agency workflows prevents individual agents from having to keep track of massive amounts of information on hundreds or even thousands of insurance contracts on a day-to-day basis. Simply put, a computer program is much better equipped to handle this amount of data than the human brain.
Polished, easy-to-read data analysis: With AMS software, the ability to parse through large amounts of data is useless unless that data can be presented to each agent at their dashboard in a way that makes it easy to read and act on. The best AMS services emphasize data access and actionability, not just accumulation.
Workforce monitoring: AMS programs can be used for monitoring and analyzing potential clientele. However, it can also be used to help monitor the workforce to see which agents are the most productive. This data can then be used for management to reward productive agents or reprimand agents who don't perform.
Social media marketing: Social media marketing and online branding are often touted as some of the most important things that a business in any industry can invest in to expand its growth in the 21st century. AMS software makes it easy for any agency to maintain a social media presence that bolsters customer rapport and retention.
Client management: AMS software can be set up to handle everything from live chat programs to direct messaging software between agents. This makes it easier for multiple agents to handle a single client regardless of who the first contact was when the client initiated the claim.
Vendor management: Along with allowing agencies to better manage their contracts and clients, AMS software can also be set up to help agencies deal with vendors. For example, in automobile insurance agencies, AMS software can be set up to pull up car parts, nearest available repair shops, and much more.
Mobile accessibility: Many of the web-based browsers and apps used by AMS software are easily accessed through mobile phones or other smart devices, which makes them a great partner for mobile insurance agents who are constantly traveling out of the office to take photos and process claims.
Cloud-based computing and artificial intelligence are the forefronts of technology when it comes to agency management. No matter what type of insurance an agency is trying to manage, an AMS software can make it easier to handle.
The single biggest advantage that automated systems like AMS software offer to agencies is that they free insurance agents up to work smarter, not harder.
Instead of having to track down individual leads or do market research on the clock when they could be generating sales, insurance agents are freed up to save their energy and resources for growing the company and solidifying its reputation on the market.
Disadvantages of Agency Management Systems
While there are many benefits associated with agency management systems software, there are also a few disadvantages to this system as well. Here are some of the drawbacks of using an AMS program:
Cost prohibitive: Either the start-up costs or the monthly subscription cost can be too expensive for a brand new agency that is still struggling to make overhead and payroll. For this reason, AMS software starts to be better for agencies as they hit a medium size in scope and feel the need to expand while maintaining their current service standard.
Diminishing returns: The smaller an agency is, the less value the agency will get out of certain aspects of the AMS software, such as workforce monitoring. Agencies with a very small, cohesive office of agents may not find these kinds of features beneficial depending on their specific workplace culture.
Dependent on broadband internet: In areas where broadband wireless internet isn't stable or affordable, AMS software may not be as feasible as a technology solution. These programs depend on constant access to the internet in order to activate cloud-computing services and use cloud-based web browsers.
Loss of human connection: AMS software automates a lot of communication with the customer, and this can come off as spam if it isn't handled correctly. The goal with AMS software is not to disconnect insurance agents and their clients, but instead remove the procedural red tape that makes communications between agent and client difficult.
Learning curve: While many of the processes incorporated in an AMS are intuitive or easy to learn, picking up an entirely new software program may be difficult to learn for some older insurance agents who aren't digital natives. Employing software tutors to school agents in the new system can help ease the transition for the old guard.
The downsides to AMS software won't be applicable to all agencies, and some agencies may not even have to worry about them. For others, excessive cost or Internet dependence can mean the difference between AMS being a good workflow automation solution or not. AMS software may also become more of a necessity the larger an insurance agency grows in scope.
Even though there may be disadvantages to an AMS program that have to be mitigated for some agencies, the overwhelming majority of agencies can see a drastic increase in productivity and streamlined workflows as a result of automated systems like AMS services.
AMS Can Provide Efficiency and Automation for Agencies
While CRM software has grown by leaps and bounds over the past decade, AMS software is an evolved extension of this service capacity. By automating many of the minor digital processes that would otherwise require hours of manpower, AMS software can save companies money and make them run more smoothly.
