(The following article was derived from Ms. Bates'presentation at the 2006 ASCNet “TENcon” annual meeting, which washeld in September in Dallas.) Your agency's mission should beto become not only a profitable but also a growing organization.And the statistics show that most of you don't grow as much asfinancial advisers recommend.

In insurance, there's no such thing as standing still. Dependingon your situation, you will lose anywhere from 4% to 11% of yourbusiness through attrition, if you just sit there. You may thinkthe loss will be made up by business from referrals calling in, butit won't be. You're going to lose more than you gain if you donothing.
Attrition also makes it more difficult to grow than you mayrealize. Suppose you have a 7% annual attrition rate and want togrow 10% a year. That means you really have to write 17% morebusiness.
Most agencies have a hard time achieving that kind of growthbecause they are what I call “task-oriented.” The main focus is ongetting the job done today. So they take care of their currentcustomers and hope for the best. A better approach is to develop asales culture. Among other things, such a culture places greatemphasis on the importance of account rounding. In this article,I'll offer some suggestions for creating such a culture.
oTake advantage of technology. First, you need to be fullyautomated. Particularly when it comes to account rounding, yourpeople will not have time to engage customers and sell themadditional insurance if they are taking 12 steps to do somethingthat should require only two.
Your agency management system should be fully loaded withinformation about clients. To conduct a marketing campaign, youmust identify clients who don't have certain coverages. The idea isto pull out of your computer lists of clients who lack earthquakeinsurance, ordinance or law coverage, etc. You can't do this onyour system unless your employees are entering customer data in aconsistent way. You can be the most persuasive person on the planetand prepare great marketing materials, but if you can't identifythe right clients to approach, you're out of luck.
When agencies can't determine from their records who lacks aspecific coverage, they sometimes just send solicitations to alltheir clients. This is not the answer. The employees wind upfielding phone calls all day long from puzzled clients who thoughtthey had the coverage in question (and often do).
Be aware that carrier downloads can jeopardize the integrity ofyour system for marketing purposes. They may override your data orput data where you don't want it. Work with your insurers tocorrect any such problems. You must have control over your owndata.
In the past few years, many carriers have set up Web sites, whereagents can perform various transactions. At some agencies, whencustomers call for quotes or to request changes, employees takecare of the requests on an insurance-company Web site. This exposesan agency to two of the most dreaded words an owner can hear:“They're down.” That amounts to saying, “Kiss good-bye toproductivity,” and, what's even worse, “We don't use oursystem; we use their system.”
You want to keep service employees focused on your agency'ssystem-not jumping around to different systems and Web sites. Youwant them to be marketers, not computer jockeys. You want themthinking not “How do I deal with this system?”, but rather “What dothese people need? What can I do for them today?”
oThink beyond the basics. Don't confine your marketing toproperty-casualty insurance. Seek a balance between P&C andbenefits. I know an agency that balances P&C and benefitsbeautifully. Also, when they write a commercial-lines account, theywrite the personal-lines for the officers. One of the things thisagency did right was to put all the coverage information into one“conglomerate,” so they can easily identify who has what. Manyagencies have learned that if you have two separate clientfiles-e.g, one for P&C and one for life and health-it's moredifficult to cross-sell. So let's put those client filestogether.
oDon't be reactive. Many of your personal-lines peoplespend hours quoting the hopeless-folks who have been turned down byevery other agency in town because they've been canceled fornonpayment, have let coverage lapse or otherwise have demonstratedthey're poor prospects.
When I ask such employees why they offer these people quotes, theysometimes respond, “That's my job.” I beg to differ. Asalesperson's job is to write clients that can help the agencyachieve its growth plans. Deadbeats and prospects that don't matchyour carriers' appetites don't fit that description.
Handling call-in business is reactive, and reactive salespeopleusually fail. The better approach is to go after the peopleyou want to write. Most of you have plenty ofcommercial-lines accounts headed by people who drive great cars andwho live in valuable homes-and you're not writing their personallines. Some of them don't even know you offer personal-linesinsurance. And the way they're entered in your database, on thecommercial- lines side, you may not even know whether you alreadyhave them as personal-lines clients.
oHire service people who can round accounts. Having theright people in customer service is a crucial step in creating asales culture. A CSR recently told me he was proud of himself forsuggesting an umbrella liability policy to a client. Then he added,“But they didn't take it.” I asked why, and he replied because theyare saving for a house. “They almost have enough for the downpayment,” he added.
I told him he had just missed a golden opportunity to sell theumbrella. When informed of his clients' plans, he should havereplied, “In that case, you really need the umbrella.You've scrimped and saved to accumulate all this money; now wouldyou like to give it to somebody else?”
“No” would be the likely reply. “Then for $150, we can protect it,”the CSR could have said, and likely have made a sale-which he didlater that day when he called them back.
A person whose mind doesn't think like this probably shouldn't betaking calls from your clients. You need to take the opportunitypresented by such contacts to better protect your clients whilehelping the agency grow.
The problem cannot always be laid at your employees' feet. If youhave established a culture where not selling an umbrella is OK,then the fault is yours. Still, some people can't be trained oreducated to sell that umbrella, even if you've made it clear theyshould. This group includes some brilliant people. They know moreabout insurance than most of us ever will. But they can't explainit to anybody; they can't engage people. They're too shy, tooanalytical or too combative, etc. These people have a place in theinsurance business-but it's not at your service desk.
oWhen clients call, seize the opportunity. Havesalespeople ever called you during dinner? How interested were youin talking to them right then? How interested are your own clientsin talking about insurance when you call them (even at other thandinnertime)? Probably not much. Rather, the best time to talk toyour clients about insurance is when they callyou and insurance is on their minds. So you need to takecare of their requests, whatever they may be, and then immediatelytalk to them about the coverages they lack.
What I often hear from agency employees is that they “don't havetime” to do this. Well, we need to make the time. If you have thewrong people handling your best opportunity to round out accounts,you're not going to be successful.
You need to use your own system, so when clients call in, yourstaff can see immediately what coverages they lack, so they willknow what to talk to them about next. Your employees should think,“They've called me and given me the opportunity to talk to themabout other coverage needs-and I want to seize it, because I knowhow hard it is to reach them. So when they call me, that'smy moment.”
You really can't lose. If the customer declines yourrecommendation, you can document the decision right then and there:“I suggested an umbrella. Client refused.” So you're covered froman E&O standpoint. If you're good at account rounding, however,more and more clients are going to say “yes” as time goes on.
oShut off the paper. Getting rid of paper is anothercrucial step in creating a sales culture. When clients call in withservice needs, you don't want your employees to put down the phoneand go searching for hard copies. Rather, you want employees tohave the information at their fingertips that enables them to say,when appropriate, “Ms. Bates, looking at your file just now, I seethere's something you probably need, which concerns me. As soon asI add your new car to your auto policy, I need to talk to you aboutit.”
oFoster an account manager mentality. I generally don'tuse the term CSR. I prefer account manager because I think itbetter conveys what service employees should be doing. Rather thanjust respond to customers' requests for service, they should alsomanage accounts, so they can develop them to their fullpotential.
oReinforce account rounding in job descriptions.Account-rounding expectations should be included in CSR or accountmanager job descriptions. They should specify not only what tasksyou want these employees to do, but also what you expectthem to accomplish.
Every CSR and account manager in your agency should know exactlythe average number of policies per account in their books: 1.57,1.73, etc. If they don't know where they are, they don't know hownear or far they are from where they need to be.
Some agencies emphasize new sales to such a degree that theyneglect account rounding. But it makes no sense whatsoever to writenew customers if you are doing a poor job of developing yourcurrent ones. Your expenses on the new business are higher than onadditional policies sold to current clients, and your revenue isthe same. Paying proper attention to account rounding also lowersthat attrition rate I mentioned at the beginning of thisarticle.
oGet producers to think team. Producers start out theircareers young, smart and aggressive. Then 18 months into careers,they find themselves in a mess. They're already saying, “I can'tget out of the office because my clients keep calling me.”
Introducing the account manager
I recently visited an independent agency where several youngproducers made this lament. As they did, I noticed the accountmanager said nothing. I took her aside to get her point ofview.
“I could take care of anything they want,” she said, “but theywon't introduce me. They won't transfer those calls tome.”
So I asked the producers if they'd rather take calls from theirclients instead of letting the account manager field them-even ifthat meant forcing customers to leave messages or having to tellthem they'd have to get the answers to their questions and callthem back?
“Well, yeah,” they replied. “They're our clients.”
In other words, they were thinking in terms of mine, mine, mine-notours. They were thinking individual, not team. They were sellingthemselves, not the agency.
In contrast, they needed to learn, as they developed clientrelationships, to sell the account manager as much as themselves,and to get clients to see how great the whole agency was.
Producers often are not taught how to do this. Consequently, theymay be reluctant to introduce account managers to clients. They maybe concerned that clients will think, “Now that he (or she) hasmade his sale, he doesn't care about me anymore.”
Producers can overcome such concerns by handling the introductionright. They should say something along the following lines: “Youknow, I'm going to be out selling other accounts, but I feel thattaking care of you is job No. 1. That's why we have someone at theagency who actually knows more than I do, who is always here, readyto answer any question you have. And quite frankly, if you call mewith a question, quite likely I will have to get the answer fromher. So she's the best person in the world to talk to.”
An agency also should give thought to the “welcome” letters itsends to new clients. Customarily, when an agency writes a newaccount, the client gets a letter signed by the producer. (Andproducers are surprised they're getting all those service calls?)How about having that letter go out from the account manager,welcoming the new customer to the agency and explaining all thewonderful things the account manager can do for the client?
When I suggested this to the producers at the aforementionedagency, one said, “That's great. That will give me more time tosell.” But another said, “But that's my client. Sheshouldn't be sending the letter.”
Do you see the disconnect? Now maybe that was just the producer'sego talking. Or maybe he thought: “I don't want these clients toknow too many people here. If I go elsewhere, it'll be a lot easierfor me to move them.” So not only does team selling lead to greaterproducer productivity; it also protects the agency's interest. Ifyou're an agency owner, you want producers to encourage clients toforge bonds with the agency and its staff. You don't want them tobe selling for themselves and developing their own books ofbusiness with your office support.
There are many more steps that you can take to create a salesculture, but I imagine you get the idea. Put your computer to workfor you, rather than the other way around. Seize opportunities foraccount rounding. Foster a team mentality among your producers. Dosuch things, and you'll find your agency is on the fast track toprofitable growth. Virginia M. Bates is co-founder of VMBAssociates Inc. and has over 20 years of experience consulting toagencies and carriers. A licensed broker and insurance adviser, Ms.Bates is also a member of ACORD's “People and Computers” nationalfaculty and Alumni Seminar Team and is a certified E&Oinstructor. She can be reached at [email protected].