When it comes to serving policyholders, the traditional insurance model sometimes falls short. This can have a detrimental effect on customer experience and perception of the industry.

Dysfunction leads insureds to believe that their relationship with their insurance company is purely transactional, that they are just another policy number. The hard market has only exacerbated this issue. Insureds, many without any claims history, faced steep rate hikes or had their coverage canceled.

The industry must begin to rebuild relationships, truly committing to providing a better customer experience. The place to start is by focusing on improving three key areas: transparency, education and innovation. Here's why:

1) Transparency delivers information and context. There is a major disconnect between insureds and carriers about what information should be shared regarding underwriting decisions and premiums. Many policyholders mistakenly believe huge rate increases are indicators that insurance companies are making big profits while they get left behind. Consumers are frequently left in the dark about the factors that play into policy premium calculations, including how state insurance laws or other regulations impact carrier decisions.

Carriers offering more transparency into how these decisions are made would go a long way to creating a more sustainable, trusting relationship. 

2) Education empowers policyholders. The majority of insureds are not insurance agents or lawyers, so it's unrealistic to expect them to understand policy language, such as coverage definitions, limitations and exclusions. The industry must do better at communicating this information to insureds simply and clearly.

Also, insureds are typically unaware of what they can do to improve their insurability, such as properly maintaining and hardening their home. Agents can prove their value by educating clients on steps they can take to protect their greatest assets. This education not only positions agents as trusted advisers but could improve overall profitability as agents and carriers help insureds become more resilient. 

3) Embrace and enhance innovation. The industry is constantly accused of being slow to innovate. When looking at how many carriers are still relying on outdated platforms and failing to capitalize on advancements in artificial intelligence (AI), it's not hard to see why.

AI can be used in a variety of scenarios to identify risks and ensure that homes meet underwriting criteria to help prevent future coverage disputes. AI can also enhance the claims experience by enabling insurers to quickly inspect claims and respond to insureds.

Additionally, insurers can use AI to enhance their communications channels to be more accessible via text, chat and social media so consumers can get the information they need when they need it.

For too long, industry shortcomings have resulted in an unsatisfactory customer experience, with agents and brokers bearing the brunt of clients' frustrations. Agents have an opportunity to partner with companies that are committed to making things better for their clients.

Brandi Wyrick is associate vice president of customer experience at Orion180 Insurance.