Writer: Max Crampton-Thomas
2 min read August 2021 — South Florida faces a particularly challenging landscape when it comes to its insurance industry, with COVID-19 adding to already existent risks like hurricanes. The result is higher premiums. Douglas Jones, managing partner at JAG Insurance Group, shared his expertise and dissected the insurance landscape in Miami-Dade.
How did JAG Insurance Group manage the unprecedented landscape of the past year?
A large part of our success is rooted in our quick reaction, whereas several of our competitors played the waiting game. Being in the customer service business, we were not going to allow any period that our clients did not have us at their disposal. It provided us an opportunity to speak to clients who were using insurance firms that were not as agile and to make a change. We’re doing more and more business today because we were able to be there for them last year.
Going forward, flexibility will be key. There is a large push around the country from employees wanting to work remotely on a permanent basis. Although people were highly productive this last year, doing so in perpetuity will prove difficult. It may produce some gaps in workflow and in some cases lead to mental health issues, where people are not getting any stimulation outside of their home environment. JAG has yet to make a final decision as a company on how it’s going to organize its work moving forward but we are going to continue providing extreme flexibility with our talent and remain highly sensitive to the pandemic and the virus that is still out there. Getting back as a team, which is not just where our service lies but also where the culture of our company lies, is going to be critical.
How has demand for your services changed over the past 16 months?
The change is profound for several reasons. There is the insurance industry side of things and the consumer side of things. From the insurance industry standpoint, we had already seen the market becoming increasingly complex for insurance reasons. For the past 24 months, some insurance companies have been struggling with their revenue, with losses, and pushing rate increases onto their clients. Worldwide, we’re seeing a massive amount of catastrophe, whether it’s hurricanes, mudslides, tornadoes and more recently the freeze in Texas, one of the biggest losses the industry has seen in years. As brokers having to navigate the right thing for our clients, we did not have to remarket a lot of people’s insurance policies on an annual basis for a long period of time because if prices remained the same or decreased, everybody was happy. Now, prices are going up, so everyone expects their policies to be shopped at multiple companies. Most agencies are not staffed or equipped to handle that type of volume.
On the consumer side, specifically being headquartered in South Florida, with the influx of people coming to Florida from all over the country, specifically the Northeast and California, we’ve seen not just new clients but an overwhelming number of them. It’s great to have all this new business come to South Florida but from an insurance standpoint, everything is more expensive in the region. We have more risk and residents know it. That’s not always the case with people moving in from the Northeast, who require a massive educational process.
It has been challenging on both fronts, but our staff has handled it tremendously well, keeping people happy with our level of service, even though prices are going up. We are shopping for the best deals and spending extra time to educate our clients on where the market stands.
We’ve also seen how tech has become a fixture in our own backyard. Miami is poised to be the next tech hub and while the insurance industry isn’t known for being forward thinking, we like to buck the trend. That’s why, for the convenience of our clients we began accepting cryptocurrency as payment. We understand that crypto is already popular among certain clients and if they prefer to use that as payment, we believe as a consumer first company, it’s our obligation to make everything, including transactions as easy as possible for our clients.
What insurance-related legislation are you keeping an eye on?
One regulatory change revolves around the National Flood Insurance Program (NFIP), operated by the Federal Emergency Management Agency (FEMA). It’s a federal program providing flood insurance. We’re getting notices that its rates are going to go up significantly soon, most likely before the end of 2021. That’s going to become a major factor when buying a home and looking at your expenses.
The second thing that we have been tracking is within the world of public adjusters, their involvement during a claim and how insurance companies can respond. There is a time and place for the use of a public adjuster. The issue is how claims are being handled and signed over to adjusters and attorneys that inflate those claims beyond reasonable recovery.
What is the role of insurance companies in the overall economic recovery?
Insurance companies are going to need to pivot in a certain manner to help policyholders and consumers feel protected from these new challenges that we are experiencing. As we come closer to the new normal, we will be seeing lenders requiring some sort of coverage for things such as pandemics that were not covered by traditional insurance policies. We’re anticipating a spike in demand for these requirements and we’re going to need insurance companies spending the time required to figure out how this can be profitable for them and reasonable for the consumer.
What is your overall outlook for the insurance industry in Miami-Dade?
The future looks bright and exciting. We just signed an expansion and extension on our headquarters in Coral Gables, where we will have just over 10,000 square feet for close to 100 people. It’s a gesture and an indication to both our employees and clients that we’re not going anywhere. We’re not downsizing to fit any market. We’re going to take advantage of what we have done well over the past 18 months and continue to ride this wave for our expansion. We could not be more excited about the next couple of years.
For more information, visit: https://jaginsgroup.
