Now that the personal lines industry is finally seeing some relief with upward rate adjustments after a prolonged soft market, the time has never been better to align the agency workforce toward the power of consultative selling. The industry is fraught with references of personal insurance as a commodity and price driving sales. Never has the adage been more true than if you sell on price, you will lose on price. The way to eliminate this is to educate and train your staff to provide constructive consultation to their clients.
The amount of work you'll need to do in each area will be determined by the size of your agency staff and their levels of experience. Whatever the situation, it is well worth the effort and best done systematically. The outcome will be an agency with better market penetration and rounded accounts. We have all heard how expensive it is to attain a new customer, so this is a great way to improve retention.
To summarize, you must:
- Know what your clients need
- Know your own markets
- Know your competition
- Round accounts at the initial point of sale
- Provide training and promote professionalism.
Know what your clients need
Shed the easy life of an order taker and become a coverage educator. ACORD applications ask questions that you should apply to ferret out customer needs. Because many insurance companies also ask questions that are not ACORD specific, a supplemental application helps. Northeast Bank Insurance Group provides one that is part of its client interview process. It covers additional questions such as level of education, exterior oil tank on slab, seasonal or secondary home and directions to property. Each agency should tailor additional questions needed to their particular underwriting environment and carrier needs.
Coverage checklists also are tools to uncover exposures and are recommended by many E&O carriers, which are usually happy to provide the agency with good coverage checklists. E&O classes also are a great resource for coverage checklists.
Know your own markets
When an agency represents more than 20 personal lines carriers, management needs to provide tools and training to help the staff achieve proficiency. A coverage comparison spreadsheet pinpoints the similarities (for example, which carriers are using ISO 2000 forms) and differences (usually in their specifically filed forms for coverage enhancements and limitations). Northeast Bank Insurance Group sent a blank coverage matrix (Excel spreadsheet) to its personal lines carriers to assemble the data in an easily accessible format.
An agent quickly can see which carriers offer what coverages as well as locate the coverages for the client that they have identified as important. Once you understand what your client needs, seek out the coverages to satisfy their needs and present the solutions for consideration, you begin to take the sales process away from price and toward needs-based selling.
This process begins decommoditizing the product. It also helps empower staff with good information and allows them to start selling value rather than cheaper insurance. This should be a core philosophy of the agency. If your agency principals and managers aren't aware of the need to provide the best coverages to the client and only sell price, this will be an uphill climb.
Know your competition
I recommend attaining copies of your competition's policies. Examine them in detail for coverage similarities and differences and add the information to the spreadsheet. This is especially helpful when competing with direct writers.
Round accounts at the initial point of sale
Ask for all of someone's business when you have them. You'll never have another chance to ask clients what else you can do for them. When you have someone's undivided attention, something that they want and you are delivering it, why not see if you can help them a bit more? If they are satisfied with the service you're providing and are already securing a policy, it's a small leap to offer them additional services and have them accept.
Provide training and promote professionalism
Our industry needs to better understand the importance of the service and products we provide. If we are providing coverage for our clients' most valuable assets--homes, cars, jewelry, boats, snowmobiles, collections, investment properties--why would we be hesitant to do our jobs completely?
Get that coverage checklist out and go over areas you know can cause issues: ordinance or law, sewer back-up, auto gap coverage, personal injury protection, flood, etc. Instead of viewing these checklists as more work, think of them as sales opportunities and a way to avoid E&O claims. If you don't discuss coverage options or additional coverages, you will never educate the customer enough to know why the insurance you are providing to them is such a good value and why they need to associate with you.
If you just can't help yourself and must talk about price, this is the time to tell your clients that you can save them much more money if you write all of their insurance policies. This is not always the case, but more often than not, it is true.
Management must follow up with sales staff, understand training needs, monitor and reward successes. Northeast Bank Insurance Group has a full time auditor/quality control person who examines different aspects of the work performed. For example, audited items could include proper use of the agency management system, compliance with requirements for signed application, cost estimators or photo. For coverage adequacy, proper coverage offerings and documentation of rejection of that offer.
This feeds information to the trainer, who can then respond to the staff's weaknesses and provide the necessary training. Over time, you'll develop a well-trained sales and service staff. This provides better depth to the sales process and will ultimately lead to a confident, professional staff, providing exemplary service and products to loyal clients.
