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Independent agencies expand into commercial lines for diversification
EZLynx says automation in personal insurance and a growing small-business market are pushing agencies to pursue commercial business as personal lines become more commoditized.
Even as growth in US commercial property and casualty business cools, independent agencies built on personal lines are increasingly moving deeper into commercial coverage, driven largely by diversification and expanding opportunity, according to Michael Rabinowitz, lead product manager at EZLynx, a cloud-based management system for independent agents, as reported by Insurance Business.
Rabinowitz pointed to two overlapping forces. Automation is making personal lines rating faster and more commoditized, increasing pressure on agencies to broaden their business, while small business insurance remains underserved and is growing. He said the pandemic reinforced the shift, with commercial business proving more resilient than personal lines during instability, and that independent agents began exploring commercial as they sought resilience and stability.
Rabinowitz said agencies are not following a single path. Some focus on a niche, such as cyber or contractor risk, while others take a generalist approach and evaluate each opportunity based on whether they have the resources to succeed. He added that technology is now helping agencies make that transition more successfully.
He also highlighted an operational challenge in commercial submissions, describing a mismatch between standardized data forms and carrier-specific portals, a friction he said the industry is working to address as more agencies pursue commercial lines.