The property & casualty insurance market has experienced challenging times in recent years and coastal areas have been particularly affected. With restrictions on new business, carriers pulling out of the market, agency commissions taking cuts and underwriting giving the word “difficult" a whole new meaning, it's no wonder many coastal agencies have felt the impact of the last few years. 

Insureds are also experiencing the effects of coastal market changes, including hefty rounds of rate increases, nonrenewals for long-held policies without lapses or claims, and new underwriting requirements at renewals.

Amidst these challenges, independent insurance agencies strive to provide exceptional service and adequate coverage to their clients. Meanwhile, insureds may feel the pressure of increasing premiums and often attribute the blame to the agency without fully understanding market dynamics.

I oversee the operations of Choice Insurance Agency in Virginia Beach, Virginia, a large independent agency with clients ranging up and down the Eastern Seaboard. Here are four strategies we've implemented for effectively navigating this coastal market:

1) Communicate proactively. As industry professionals, we may overlook how market challenges affect our insureds when they receive a renewal notice indicating a 60% increase—despite having no claims—or when they receive a notice that underwriting is requiring repairs to their property when they haven't had an inspection in years. These experiences can leave them feeling confused, frustrated and motivated to shop for alternative coverage.

Extending relevant, timely and empathetic communication to add clarity to the situation goes a long way. Provide context for the insured's experience by sharing relevant updates about the coastal market that may be impacting their policies—including recent storms, major carriers reducing coverage offerings at the coast and the overall insurance market. Empathize with their situation and make sure they know you will proactively engage in a solution for them.

Effective support can be provided by assigning dedicated account managers to specific segments of the agency's portfolio and conducting thorough reviews of upcoming renewals with insureds.

While sharing these insights with the insured does not remove the sting of soaring premiums or coverage changes, it puts these changes in perspective and allows you to provide expert advice to help them navigate these changes.

2) Lock in on value. Coastal agencies no longer have the advantage of accessing multiple markets that are competitively priced and eager to expand and maintain their agency relationships. Given these limited options, coastal agencies need to change their approach to engaging with our insureds. Proactively engaging with insureds, adding personalized value and advising with transparency is the best way forward.

Coastal agencies must focus on conversations that add value and apply to the insured's situation. Take the time to discuss changes in their needs, advise on their best path forward and provide solutions, whether by shopping their coverages through another available market or reviewing existing coverages.

Approaching these conversations holistically solidifies the value you provide clients while ensuring you are providing the protection that they need through market changes.

This can also be a great time to provide additional support for your insureds to improve their experience. Proactive, comprehensive account reviews, providing after-hours and weekend support for service, sales and claims, or offering online client portal services are all ways to establish ease of use and value to your insureds.

3) Invest in your team. In this challenging market, it's easy to go into fire-fighting mode. However, a vital contributor to a coastal agency's ability to navigate this hard market is the team that is directly working with your clients.

Investing in the professional development of your team provides them with the necessary resources to manage carrier updates, adapt to underwriting changes and communicate policy adjustments or increases with empathy and precision. This enables them to more effectively achieve beneficial outcomes for both clients and the agency.

4) Leverage carrier partnerships. When market conditions become challenging, it is common to adopt an "us versus them" mentality, pitting the carrier against the agency. However, this is the perfect time to solidify carrier partnerships.

Bringing your carrier partners into the challenges alongside you can equip your agency to better navigate the market challenges and provide the best possible resources for your insureds. This could involve setting up strategic book rolls to diversify your book for coastal segments losing carriers, utilizing carrier service center support, asking for carrier support on renewal reviews, or adjusting market preferences to align growth areas with willing carriers.

Some coastal carriers have even allocated resources to offer additional discounts, perform remarketing for the agency and extend client support and claims hours during peak storm seasons. Profitable partnerships can form in tough markets when carriers support their agency partners, leading to stronger ties and mutual growth during easier times.

The past few years have been regarded as the most challenging period for our industry in over two decades, particularly along the coast. “Business as usual" is long gone and the shifts we have implemented will leave a resounding echo in coastal agency operations for years to come.

Kelley Carter is senior vice president of operations at Choice Insurance Agency, a member of Choice Financial Group, in Virginia Beach, Virginia.