ACG - Agency Consulting Group

The PIPELINE

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

Putting the Customer First

While traveling home following another successful agency consultation, my flight was delayed, and finally canceled. This is a hazard of the consultation industry I have become accustomed to. Unfortunately, I have also become accustomed to the poor customer service the airline industry delivers to their clientele on a regular basis. In fact, it is noteworthy when as airline provides the customer service that we would expect as commonplace in most other industries.

And let’s face it, all airline travel is the same. It is the fastest way from point A to point B, so I have to travel that way. If you pay more for First Class, you expect more in First Class. By in large, we are far more likely to just pick the cheapest price for the ticket unless there is some reason to choose a more expensive ticket. Airline Travel is nothing but a commodity! In fact, I don’t even need a travel agent anymore, they’re just going to cost me more money. I can just use the internet because any number of sites will list the lowest ticket prices and I can choose from any airline.

This sounds very familiar! If we listen to our customers, how many would say:

All insurance is the same. It is required by law, so I have to have it. If I pay more, I expect more from my agent. By in large, we are far more likely to just pick the cheapest price for insurance unless there is some reason to choose more expensive coverage. Insurance is nothing but a commodity! In fact, I don’t even need an insurance agent anymore, they are just going to charge me more money. I can just use the internet because any number of sites will list the lowest insurance prices and I can choose from any company.

Of course, we know better than that. While Home and Auto or BOP policies may not be complicated, the more complex needs of our clients require the specialized, professional advice and management of an agent. Agents ask the questions that the internet doesn’t know to ask. Agents don’t do this because they are trying to charge the customer more, but because the agent’s concern is to do an analysis of insurable and non-insurable needs and suggest the products that offer protection for those exposures that the customer has. Sometimes, the agent will use multiple carriers to meet the needs of the customer. Occasionally, the agent will use another agency to help fill the gaps in coverage. Show me the website that will do that!

This is not revolutionary, it is called Customer Service. Industry-wide, the best agencies provide the service that is expected, and occasionally, they offer services that are unexpected. That doesn’t mean treating VIP customers to a ball game or a free lunch. T&E is important to retaining high end accounts, but that is not customer service. Customer service begins with building a relationship with the customer. Then, through a focused and specific marketing program designed to offer every product and service to every customer you have on a regular and scheduled basis. Through regular contact, feedback, and a knowledge of the products and services your agency offers, you will, without a doubt, differentiate your agency from your competitors. If this sounds familiar, you are likely aware of our Asset Protection Model of Relationship Sales. Building the relationship with your customers is what the customer already expects. As an industry, we promise this service, and often fail to deliver.

Customer service is also expected is when a customer has a claim, but not as you, the agent, may expect. Large or small, the most successful agencies across the country are those that do the following:

- Own the customer – don’t blindly refer the customer to an “800” number. Direct them to call your office first, and provide the service to help them begin the process of the claim.

- Contact the customer – Whether the customer is a personal lines, single policy holder or the largest commercial lines account in the agency, as soon as you are aware of the loss, contact the customer. Ask of they are OK, or how this will affect their business. Ask them if they need assistance that you can provide. And make sure the claim has been successfully initiated.

- “Shepherd” the claim – follow the claim, and periodically check in with your customer. This is the single, most likely point at which a customer could leave you. There is no conscious differentiation by the customer between the agent, agency and the company unless you tell them that there is. Let the customer know that you are on their side and that you will do what you can to help, even if it is only confirm information or make certain that the claim is being processed.

- Follow through in recovery after a claim – Agents have many connections within a community. Something as simple as preparing a list of community businesses that offer services to help after a claim will leave the impression with your customers that you are doing everything you can for each customer. This list might have everything from auto repair shops and fire cleanup to mold remediation and water recovery, and even the local florists. And when that list is provided, let the customer know that some of the names listed are your business customers, and some are not, but you don’t accept “kickbacks” from their business, and you only ask that the customer let them know that Your Insurance Agency” suggested the contact. In that way, those businesses that do have their insurance with you know you sent business their way, and those businesses that don’t write with you now have a reason to contact your agency . But that is a marketing program for another article.

Agency Consulting Group calls this process Shepherding Claims. Although we know that none of these activities is something agencies are compensated for, surveys suggest that this is exactly the kind of customer service that our customers expect from us. Agencies with great service people already do this, and they all but guarantee a customer for life.

Unexpected customer service is providing for the customer when they didn’t even know to ask. We know, and we don’t need research to prove, that customers are not tolerant of rate hikes. Generally speaking, the agency is not in control of rate increases, especially due to loss or market conditions. But this provides a golden opportunity to provide another contact with the customer as well as service that is unexpected. When your agency receives notice of a rate increase, let the customer know that an increase is on the way. Explain why there is an increase, and let them know whether it is reasonable or not. If the increase is beyond tolerances, ask their permission to remarket the policy. Again, this is all before the customer receives the notice of a rate increase. To the customer, they see an agent aggressively working for them to keep their policy affordable. The agency is, once again, building a relationship that will help keep that customer.

A final note about unexpected customer service. The best agencies we’ve encountered are those that address risks that are uninsurable. As your Relationship Manager or Producer is performing the risk analysis of a prospect, he or she will undoubtedly discover exposures that are simply not insurable. We expect our agents to be experts in insurance, but if a small business doesn’t have an HR manager, there may be EPLI exposures. And in addressing those exposures, have the resources available to refer the business to someone who can help correct those exposures. Or even better, bring that person along as an expert. More than simply lending credibility to your agency, you are providing a service that you could not otherwise provide.

Fortunately, the insurance industry is not the airline industry. We have the ability to focus on customer service at the agency level. If a competing agency fails to provide the same exceptional customer service, that’s OK because your agency likely has room for their best clients. The bottom line is focusing on customer service is good for the bottom line. If you would like to integrate exceptional customer service into a low-cost, highly effective part of your overall prospect conversion and customer retention program, call (800) 779-2430 and ask for David.