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

In insurance, there's no such thing as standing still. Depending on your situation, you will lose anywhere from 4% to 11% of your business through attrition, if you just sit there. You may think the loss will be made up by business from referrals calling in, but it won't be. You're going to lose more than you gain if you do nothing.
Attrition also makes it more difficult to grow than you may realize. Suppose you have a 7% annual attrition rate and want to grow 10% a year. That means you really have to write 17% more business.
Most agencies have a hard time achieving that kind of growth because they are what I call “task-oriented.” The main focus is on getting the job done today. So they take care of their current customers and hope for the best. A better approach is to develop a sales culture. Among other things, such a culture places great emphasis 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 fully automated. Particularly when it comes to account rounding, your people will not have time to engage customers and sell them additional insurance if they are taking 12 steps to do something that should require only two.
Your agency management system should be fully loaded with information about clients. To conduct a marketing campaign, you must identify clients who don't have certain coverages. The idea is to pull out of your computer lists of clients who lack earthquake insurance, ordinance or law coverage, etc. You can't do this on your system unless your employees are entering customer data in a consistent way. You can be the most persuasive person on the planet and prepare great marketing materials, but if you can't identify the right clients to approach, you're out of luck.
When agencies can't determine from their records who lacks a specific coverage, they sometimes just send solicitations to all their clients. This is not the answer. The employees wind up fielding phone calls all day long from puzzled clients who thought they had the coverage in question (and often do).
Be aware that carrier downloads can jeopardize the integrity of your system for marketing purposes. They may override your data or put data where you don't want it. Work with your insurers to correct any such problems. You must have control over your own data.
In the past few years, many carriers have set up Web sites, where agents can perform various transactions. At some agencies, when customers call for quotes or to request changes, employees take care of the requests on an insurance-company Web site. This exposes an agency to two of the most dreaded words an owner can hear: “They're down.” That amounts to saying, “Kiss good-bye to productivity,” and, what's even worse, “We don't use our system; we use their system.”
You want to keep service employees focused on your agency's system-not jumping around to different systems and Web sites. You want them to be marketers, not computer jockeys. You want them thinking not “How do I deal with this system?”, but rather “What do these people need? What can I do for them today?”
oThink beyond the basics. Don't confine your marketing to property-casualty insurance. Seek a balance between P&C and benefits. I know an agency that balances P&C and benefits beautifully. Also, when they write a commercial-lines account, they write the personal-lines for the officers. One of the things this agency did right was to put all the coverage information into one “conglomerate,” so they can easily identify who has what. Many agencies have learned that if you have two separate client files-e.g, one for P&C and one for life and health-it's more difficult to cross-sell. So let's put those client files together.
oDon't be reactive. Many of your personal-lines people spend hours quoting the hopeless-folks who have been turned down by every other agency in town because they've been canceled for nonpayment, have let coverage lapse or otherwise have demonstrated they're poor prospects.
When I ask such employees why they offer these people quotes, they sometimes respond, “That's my job.” I beg to differ. A salesperson's job is to write clients that can help the agency achieve its growth plans. Deadbeats and prospects that don't match your carriers' appetites don't fit that description.
Handling call-in business is reactive, and reactive salespeople usually fail. The better approach is to go after the people you want to write. Most of you have plenty of commercial-lines accounts headed by people who drive great cars and who live in valuable homes-and you're not writing their personal lines. Some of them don't even know you offer personal-lines insurance. And the way they're entered in your database, on the commercial- lines side, you may not even know whether you already have them as personal-lines clients.
oHire service people who can round accounts. Having the right people in customer service is a crucial step in creating a sales culture. A CSR recently told me he was proud of himself for suggesting an umbrella liability policy to a client. Then he added, “But they didn't take it.” I asked why, and he replied because they are saving for a house. “They almost have enough for the down payment,” he added.
I told him he had just missed a golden opportunity to sell the umbrella. When informed of his clients' plans, he should have replied, “In that case, you really need the umbrella. You've scrimped and saved to accumulate all this money; now would you 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 did later that day when he called them back.
A person whose mind doesn't think like this probably shouldn't be taking calls from your clients. You need to take the opportunity presented by such contacts to better protect your clients while helping the agency grow.
The problem cannot always be laid at your employees' feet. If you have established a culture where not selling an umbrella is OK, then the fault is yours. Still, some people can't be trained or educated to sell that umbrella, even if you've made it clear they should. This group includes some brilliant people. They know more about insurance than most of us ever will. But they can't explain it to anybody; they can't engage people. They're too shy, too analytical or too combative, etc. These people have a place in the insurance business-but it's not at your service desk.
oWhen clients call, seize the opportunity. Have salespeople ever called you during dinner? How interested were you in talking to them right then? How interested are your own clients in talking about insurance when you call them (even at other than dinnertime)? Probably not much. Rather, the best time to talk to your clients about insurance is when they call you and insurance is on their minds. So you need to take care of their requests, whatever they may be, and then immediately talk to them about the coverages they lack.
What I often hear from agency employees is that they “don't have time” to do this. Well, we need to make the time. If you have the wrong 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, your staff can see immediately what coverages they lack, so they will know what to talk to them about next. Your employees should think, “They've called me and given me the opportunity to talk to them about other coverage needs-and I want to seize it, because I know how hard it is to reach them. So when they call me, that's my moment.”
You really can't lose. If the customer declines your recommendation, you can document the decision right then and there: “I suggested an umbrella. Client refused.” So you're covered from an 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 another crucial step in creating a sales culture. When clients call in with service needs, you don't want your employees to put down the phone and go searching for hard copies. Rather, you want employees to have the information at their fingertips that enables them to say, when appropriate, “Ms. Bates, looking at your file just now, I see there's something you probably need, which concerns me. As soon as I add your new car to your auto policy, I need to talk to you about it.”
oFoster an account manager mentality. I generally don't use the term CSR. I prefer account manager because I think it better conveys what service employees should be doing. Rather than just respond to customers' requests for service, they should also manage accounts, so they can develop them to their full potential.
oReinforce account rounding in job descriptions. Account-rounding expectations should be included in CSR or account manager job descriptions. They should specify not only what tasks you want these employees to do, but also what you expect them to accomplish.
Every CSR and account manager in your agency should know exactly the 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 how near or far they are from where they need to be.
Some agencies emphasize new sales to such a degree that they neglect account rounding. But it makes no sense whatsoever to write new customers if you are doing a poor job of developing your current ones. Your expenses on the new business are higher than on additional policies sold to current clients, and your revenue is the same. Paying proper attention to account rounding also lowers that attrition rate I mentioned at the beginning of this article.
oGet producers to think team. Producers start out their careers young, smart and aggressive. Then 18 months into careers, they find themselves in a mess. They're already saying, “I can't get out of the office because my clients keep calling me.”
Introducing the account manager
I recently visited an independent agency where several young producers made this lament. As they did, I noticed the account manager said nothing. I took her aside to get her point of view.
“I could take care of anything they want,” she said, “but they won't introduce me. They won't transfer those calls to me.”
So I asked the producers if they'd rather take calls from their clients instead of letting the account manager field them-even if that meant forcing customers to leave messages or having to tell them they'd have to get the answers to their questions and call them back?
“Well, yeah,” they replied. “They're our clients.”
In other words, they were thinking in terms of mine, mine, mine-not ours. They were thinking individual, not team. They were selling themselves, not the agency.
In contrast, they needed to learn, as they developed client relationships, 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, they may be reluctant to introduce account managers to clients. They may be concerned that clients will think, “Now that he (or she) has made his sale, he doesn't care about me anymore.”
Producers can overcome such concerns by handling the introduction right. They should say something along the following lines: “You know, I'm going to be out selling other accounts, but I feel that taking care of you is job No. 1. That's why we have someone at the agency who actually knows more than I do, who is always here, ready to answer any question you have. And quite frankly, if you call me with a question, quite likely I will have to get the answer from her. So she's the best person in the world to talk to.”
An agency also should give thought to the “welcome” letters it sends to new clients. Customarily, when an agency writes a new account, the client gets a letter signed by the producer. (And producers 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 the wonderful things the account manager can do for the client?
When I suggested this to the producers at the aforementioned agency, one said, “That's great. That will give me more time to sell.” But another said, “But that's my client. She shouldn't be sending the letter.”
Do you see the disconnect? Now maybe that was just the producer's ego talking. Or maybe he thought: “I don't want these clients to know too many people here. If I go elsewhere, it'll be a lot easier for me to move them.” So not only does team selling lead to greater producer productivity; it also protects the agency's interest. If you're an agency owner, you want producers to encourage clients to forge bonds with the agency and its staff. You don't want them to be selling for themselves and developing their own books of business with your office support.
There are many more steps that you can take to create a sales culture, but I imagine you get the idea. Put your computer to work for you, rather than the other way around. Seize opportunities for account rounding. Foster a team mentality among your producers. Do such things, and you'll find your agency is on the fast track to profitable growth. Virginia M. Bates is co-founder of VMB Associates Inc. and has over 20 years of experience consulting to agencies and carriers. A licensed broker and insurance adviser, Ms. Bates is also a member of ACORD's “People and Computers” national faculty and Alumni Seminar Team and is a certified E&O instructor. She can be reached at vmbinc@aol.com.

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