ACG - Agency Consulting Group


A national monthly newsletter for agency principals dedicated to agency management topic

The Asset Protection Model - Update 2007

As many agents already know, the Asset Protection Model (APM) of Relationship Selling is sweeping the country.

Why? Because it is the first process in many years that trains agents in how to provide value-added services as the basis for conversion of prospects into clients instead of the hunt for price-competitive quotes.

The APM has four primary components:

NEVER SELL PRICE – It’s a losing proposition that only further defines us as the used car salespeople of the insurance industry,

PROVIDE VALUE-ADDED SERVICE AHEAD OF THE CONVERSION – People don’t want to be “sold” anything. They know they need insurance and they want to buy it from someone they trust. They cannot be expected to throw over an existing relationship (regardless of how tenuous) based on one visit by someone who “claims” to be able to provide better insurance, cheaper.

PROVIDE AN ANALYSIS OF EVERY LINE OF BUSINESS FOR WHICH YOU ARE COMPETENT TO EVERY CLIENT AND PROSPECT – this is the charter that you owe to each client – to make sure that they are either properly covered for all of their insurance-based needs (or that they know that they are not properly covered).


You fall into the “price trap” when you and your producers are constantly bringing new prospects to the door, only to lose them to competitors (or to the incumbent) after expending valuable producer and agency time in the quest for product and price. Of course price is important to the customer (especially when he doesn’t think you bring anything else to the table). But you (and most intelligent clients) already know that Price is a moving target changing annually by carrier. Unless you are selling a pure commodity (no difference between product, supplier and agency representation) it is you duty to show the client the points of differentiation that separate you from the traditional “price shoppers” in the market. In many cases the differences between price, product and carrier seems to have disappeared. It is, therefore, incumbent upon us to actually generate services that are both valuable enough for the client to understand why we are different.

Although most agents are still asleep, there exists a handful of third-party vendors who can put you into the category of “different from the normal agency” through services that affect the clients TCOR (Total Cost of Risk), well beyond the value of premiums, alone. If you are not yet aware of TCOR, please do yourself a favor and bone up on this acronym. It is not a trick or a gimmick. Nor is TCOR simply the “Acronym of the Month” for the industry. It is a real way of calculating the costs of risk comprised of insurance premiums and much more. You see, the clients face much more expense that just their premiums. Costs of deductibles and self-insurance retention is just the start of the additional costs facing most medium and larger commercial clients. If they use risk management services, those costs must be integrated in the Total Cost of Risk. But risk is not even limited to insurable risks. Most businesses now face federal and state regulations that, if not fully adhered to, can cost them many dollars in penalties and interest. While not insurance-based, these are certainly “costs” associated with managing a business that can be overcome by judicious audits of procedures and processes. We now have specialists who can teach these processes to you and you can, in turn, provide services to clients and prospects to which most agents have absolutely no access.

We can show you how to use these value-added services to show prospects why you are so much more valuable than their current agent that they will want you to handle all of their insurance programs, as well.

Every agent that we have encountered have agreed that they do not do as good a job cross-selling to their existing clients as they should. Yet few pursue aggressive internal cross-selling programs to maximize the benefit of the agency to the clients (and the value of the clients to the agency). We can show you how to do this within the Asset Protection Model.

Every agent also agrees that referral sales are the best quality and the longest lasting. Yet few have any kind of Active Referral program as taught and mandated by the Asset Protection Model through the Three-Hook Approach to getting referrals. Agents have told us that they feel uncomfortable asking for referrals. When we probe, we find that they are embarrassed because most don’t value themselves or their services sufficiently to consider asking for referrals a favor to the client and his friends. The APM will redefine your agency’s value until you and your producers acknowledge that you can do so much more than the traditional agent that you are proud to ask for and pursue client referrals in a pro-active (as opposed to strictly reactive) way.

The Asset Protection Model is both new and old. It sells away from price and toward actual value of the agent to the client (like it used to be before we got caught in the Price Wars). It retrains agencies and producers until the agency never quotes insurance again – yet conversion rates of new clients will climb to above 90%.

What is the “down-side” to the APM? The agencies participating take a much longer time to establish relationships (knowing that over 90% will result in clients for life) and take on new services to differentiate themselves from the common competitors who will live and die on price quoting.

If you are finally ready to “convert”, invite us to analyze your agency to determine how you can become an APM agency and join the few agencies in the 21st century who will no longer let price alone define your successes.