Insurance agency owners and sales managers need to hire the right kind of people for insurance sales. For assistance with hiring and training producers, The National Alliance Research Academy regularly conducts its "Producer Profile" study, which surveys P&C insurance producers from across the country. Following are some of the study's results from the 2015 edition.
New producer difficulties
More than half of new producers struggle the most with cold calling. As producers become more experienced, they can get more referrals and spend time servicing their accounts, so the amount of time spent cold calling may go down.
Lack of support is also a problem. This could mean that there is not enough sales support and training. Once hired, too many new producers only receive limited training and guidance. Lack of support also indicates limited help from the service staff, forcing the new producer to spend more time on routine servicing functions and less time on prospecting and selling.
New producers struggle with time management. If they are not pre-qualifying their prospects, they may be spending too much time going after accounts where they have little chance to succeed. Also, if they are given a book of business to service, new producers may spend too much time servicing that book and not enough time calling new prospects.
| Difficulty | % Commercial Producers |
| Cold calling prospects | 56% |
| Lack of support | 36% |
| Managing my time | 35% |
| Finding prospects | 32% |
| Acquiring technical knowledge | 27% |
| Dealing with objections | 26% |
| Using a consistent sales process | 25% |
| Closing the sale | 22% |
| Meeting sales quotas | 17% |
| Building rapport with prospects | 16% |
| Acquiring active listening skills | 9% |
| Other | 4% |
Training as a new producer
Going on joint sales calls with experienced producers was the most frequently used method for training new hires. The inexperienced producer could observe and learn how the veteran agent conducted sales interviews. At other times, the new producer could take the lead, knowing that the seasoned agent was there to back him or her up, if needed.
A number of producers learned about the industry by managing an existing book of business. Just under a third of the producers were assigned an agency mentor.
Amazingly, nearly a third of new producers did not receive any significant training after they were hired. They were simply left alone to learn on the job and were told to call prospects and make sales.
| Training Method | % Commercial Producers |
| Joint sales calls | 40% |
| Managing existing accounts | 35% |
| Assigned a mentor | 31% |
| Dedicated support person | 20% |
| Consistent, qualified leads | 9% |
| Other | 6% |
| None | 32% |
Sales skills where producers most need improvement
This survey question addresses where veteran producers still have some struggles and still need to improve. Even with experienced producers, prospecting can still be a problem. Some producers struggle with effective questioning and probing. Producers need to uncover needs that are not being fulfilled by the incumbent agent. Many agents are looking to improve in this area; use of a Diagnostic Appointment Questionnaire, as used in the Dynamics of Selling program, can help to uncover pain points and address the prospect's needs.
There are some veteran producers who still need to improve by better handling objections. Most agents try to sell based on something other than price, but overcoming a lower price is difficult to handle.
| Skills | % Commercial Producers |
| Prospecting | 50% |
| Effective questioning and probing | 38% |
| Handling objections | 26% |
| Closing the sale | 24% |
| Negotiating with customers | 20% |
| Active listening | 17% |
| Building relationships with clients | 11% |
| Other | 6% |
Reasons for leaving
According to survey results, the No. 1 reason for leaving one agency was poor management. This could encompass any number of things: The agency did not have adequate markets, training may have been poor or inadequate, staff may have been mediocre, or teamwork suffered. Agencies that are poorly run will suffer from higher producer attrition rates. Whatever the reason, good producers are going to move to the better agencies to reach their full potential. Agencies that are poorly run will suffer from higher producer attrition rates.
Producers also say they leave because of personality conflicts and inadequate compensation. Typically, it's the supervisor-employee relationship that can suffer from personality clashes. Producers need some direction, but most of them want their independence. Seasoned producers may want to earn equity in the book of business, but not all agencies will offer this. For the young producers in training, they will need a salary the first 1-3 years, but this can be a bargaining point; agency owners will want to decrease the initial salary over time.
Producers also say they leave due to inadequate support staff. The agency may be understaffed and the producer may have to do much of their own service work, cutting into their sales time. Or, the staff may not have the knowledge and experience to provide consistently good service to their customers; this can lead to lower account retention rates, leaving the producer dissatisfied.
| Reason | % Commercial Producers |
| Poorly managed agency | 34% |
| Personality conflict | 24% |
| Inadequate dollar compensation | 23% |
| Inadequate support staff | 19% |
| Unfavorable location | 7% |
| Low personal production | 6% |
| Inadequate benefits | 5% |
| Long work hours | 4% |
| Other | 42% |
Other reasons included: agency purchased or merged, left for better opportunity, change of location/moved.
In summary
Training is key for new producers. Sales managers should determine what is most difficult for their new producers and get them the training they need to acquire the needed sales skills and abilities. Many new producers struggle with cold calling, so lead generation can at least push producers in the right direction.
New producers can often benefit by learning from others. Joint sales calls and mentoring help the new producers learn from the seasoned producers. Plus, they have someone they can ask for advice and direction.
Producers need training throughout their career. Sales managers need to ascertain the areas where their producers need more training. This is most critical for the young producers, but experienced producers need refresher courses, as well.
Top agencies find a way to retain their top sales agents. If there are problems, agency owners and sales managers need to discuss any difficulties with their producers and not let the problems get out of hand. Regular communication between the sales manager and the sales staff is needed to stay on top of any difficulties that may be brewing.
New producers need a lot of direction, whereas the experienced ones obviously don't need as much. The smart agency owner or sales manager will stay tuned to the needs of all their producers and give them direction with they need it, and independence when they don't.
For more insights, including statistical analysis, and to order a copy of the Producer Profile study, visit www.TheNationalAlliance.com.
Jim is the Research Director for the National Alliance Research Academy and the editor of Resources magazine. He has over 30 years experience in the insurance industry after working as an underwriter for two insurance companies. After earning his MBA, Jim has now been with the National Alliance for more than 25 years.
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