Urban Market Expert: Learn Your Customer First

Mr. Kruck, in remarks released in advance of the conference said, firms must do careful research and analysis in the urban marketplace and if they simply rely on their current product development and distribution models, they may fail.

"Many companies will start out with their standard policy and think of how they can market the policy to an urban customer, without thinking through whether the customer wants the product. This leads to missed opportunities or worse," Mr. Kruck said.

He said he finds that insurers are not alone is making this mistake. Banks assumed that urban customers wanted all the same banking services as their other customers, and failed to realize that among some market segments, customers needed money transfer services. As a result, banks missed out on a highly profitable money transfer business, and are now retooling to accommodate that need, Mr. Kruck said.

"Don't make the mistake of limiting your ideas," said Mr. Kruck. "Start with customer needs and involve your whole company in the process. Remember that your product is the sum total of the customer's experience with your company."

He added, "Don't limit yourself to ideas you think will fit into the existing regulatory framework. Regulators want the market to be served, and if you have a new product idea, talk with them about why you think it will benefit the customer."

Daniel Sullivan, president, DJS Sullivan and Associates, a Chicago-based marketing firm, another of the experts who will talk at the conference, said in advance remarks that, "It is also important to realize that your company's brand value means different things to different people, and their perception is influenced by their cultural background.

"For some groups, financial stability may be important, whereas for others, how long your company has been in business counts more." He added that this evaluation process extends to agent recruitment and development, where companies may need to rethink how they work with urban agents.

Donald Lewis, president of Insurance Cooperative, a Philadelphia-based agency network, in remarks released in advance of the conference said, "Agent training, beyond continuing education courses, is key. There are some agents that use the ?take all comers' approach, and those that are already using standard carriers' underwriting."

He continued that, "There is also a middle group of agents who can move into the standard carriers' criteria if they receive some additional training. But, many of them are afraid to ask. This is similar to the student in class who doesn't ask a question because he is afraid he will be considered ignorant, but in fact, many other students also want to know the answer."

Michael Yeager, president and chief executive officer of Lehigh Mutual Insurance Company, in advance remarks, said, "The good news is that companies which execute a solid urban markets strategy can and do succeed. We instituted an urban markets strategy, and it is a profitable book of business."

The institute said Pennsylvania Commissioner Diane Koken, New Jersey Commissioner Holly C. Bakke and Illinois Director Anthony Clark will also be speakers.

UIPI is a nonprofit educational organization supported by the insurance industry. UIPI conducts workshops for insurers, and it promotes consumer education on homeowners and commercial insurance. More information on the institute, the workshop and its programs is online at
www.uipi.org.