A successful insurance agent knows that after a policy is written the work is far from over. Once new business is on the books, it’s important to ensure that it stays there come renewal time and, hopefully, for many years to come. After all, retention is how an insurance agency grows.
According to the online insurance news hub NS Insurance, a survey by Collinson shows that only 46% of respondents regularly hear from their insurance provider during the year, with 39% missing out on receiving relevant product information and recommendations. The survey also showed that consumer openness for communication is conditional, with policyholders expecting the content they receive to be personalized and based on their individual needs and interests, as well as presenting them with key benefits. In fact, 50% of respondents said they would view their agent more positively if he or she offered information as well as products and benefits that were relevant to them in addition to core insurance product offerings.
“[Today’s] consumers are open to receiving useful information from their insurance providers about products and services, as well as about the benefits they currently have access to but may not be making use of.”
Source: Collinson Group
By far, the most effective way to prevent policies from falling off the books at renewal (or any other time during the policy period) is to maintain ongoing communications with your policyholders. If you’re just too busy or don’t see the purpose in staying in touch with clients throughout the year, consider the following three reasons why you should rethink how communication can create a positive experience for you and your clients.
Communication builds policyholder loyalty. The saying “Just because nobody complains doesn’t mean that all parachutes are perfect” can be applied to insurance. For example you may, unbeknownst to you, have policyholders who are unhappy with their coverage, rates, billing mode, claim experience, etc. If you aren’t regularly communicating with your clients, there’s no way you’ll know these issues are happening and, therefore, can’t make an attempt to fix them. In many instances, policyholders will take matters into their own hands and look to your competitors to help them solve these challenges.
Regular communication during the year demonstrates to policyholders your commitment to ensuring they have the coverage and service they need and deserve from your agency. Ways to build loyalty with your clients and show them that you are more than just a name on a bill every month can include a monthly newsletter, blog article, semiannual policy review, etc.
Communication increases new business opportunities and reduces monoline accounts. It happens more often than you think: A client who purchased a homeowners policy last year now recognizes the need to secure a life insurance policy. A client who is considering a new business venture now needs business insurance quotes. Then there is the client with an auto policy who needs to insure a newly acquired boat, motorcycle or recreational vehicle. While your agency may offer these additional insurance products, is it clear to your existing policyholders?
Staying in touch with policyholders during the year allows you to stay on top of what’s going on in their lives. It also provides an opportunity for them to ask product and coverage questions, giving you — not your competitors — a first chance to help them with new business quotes. Don’t let them assume that you don’t offer specific products or services! Not only is staying in touch the perfect way to increase new business, but rounding out monoline accounts has been shown to increase customer loyalty and reduce agency attrition. How can you improve marketing communication regarding complementary insurance products to policyholders who have a monoline homeowners, renters, life or auto policy with your agency?
Communication can help reduce claims. As an agent, you know that a large claim or too many claims can negatively affect an insurance policy. From an increase in premiums to a policy cancellation or nonrenewal, these situations create unhappy policyholders who are likely to shop around and then leave you. Staying in touch with your insureds can help you better understand potential risk exposures that even they may not have considered and aid you in mitigating those risks.
For example, has a homeowner started a home-based business and now has a liability exposure regarding clients coming to their residence? What about the addition of a new pool or trampoline? Have there been growing weather-related risk exposures that now require additional coverage? Policy reviews are an effective way to manage policyholder risks. Reviews can be done within the agency, at the policyholder’s residence, or by email or mail with a type of policy questionnaire or checklist.
Let’s face it. If selling insurance was easy, everyone would be doing it. Sure, creating a marketing strategy that includes regular communication with policyholders takes time and effort, but by doing so you can increase customer loyalty, reduce claims, grow your policy count and improve retention.
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