ACG - Agency Consulting Group

The PIPELINE

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

CREATING A CUSTOMER-CENTRIC INSURANCE AGENCY

Every agency claims that they are service oriented and concerned most with the well-being of the customer. But is it true?

With the exception of the true brokers (who represent the clients, not the carriers), we must remember that first and foremost we are agents of the companies that we represent. Our well-being is subject to how well we grow for the carriers and how profitable we are with the business that we submit to them.

However, if we were to place that remark in our website, in our advertising and as a sign in our agency, we would probably not attract many customers. The customers must know that we are sincerely concerned with their well-being and are interested primarily in the protection of their assets rather than in simply selling more insurance to them. And most independent agents fairly serve both the interests of their customers and those of their carrier-partners. Still, too many agents have a love/hate relationship with either the carriers they represent and/or with the clients they serve.

The concept of being CUSTOMER-CENTRIC does not obviate the primary goal of supporting and protecting the insurance companies. What it does is make the sale of our carriers’ products subservient to the needs of the end-client.

The concept of being CUSTOMER-CENTRIC involves teaching ourselves and our employees that it will always be right to do what’s in the customer’s best interest (limited by actions dangerous to ourselves, our agencies and our carriers or unethical or illegal activities). All of the many ‘faith-based’ agencies that dot our universe have believed in that concept for years and generations and serve their customers well without endangering their carrier relationships.

But it is much harder to BE Customer-Centric than to claim to be Customer-Centric.

1. Are you handling claims in a “Customer-Centric” manner?

Insurance companies encourage you to relay customer claims issues directly to them to speed handling. However, our Customer Satisfaction Surveys consistently indicate that one of the primary reasons that customers of independent agencies use us instead of our direct writer competitors is that they believe that an insurance company will attempt to cover a loss for the least cost possible while an agent will support the customer and protect the customer who is usually inexperienced in claims situations. A Customer-Centric agency will always handle both first reports of losses, counseling the clients on the dangers of being too claims conscious in minor situations, and continue to actively follow up on claims until they (and the customer) are satisfied that the claim has been handled properly. Calling the client with updates on his claim instead of waiting for complaints of poor handling is an independent agent’s best referral marketing. If every claim is simply referred to the carrier, why does the client need an agent?

2. Are you handling customer service communications in a Customer-Centric manner?

Many insurance companies, in the name of efficiency, recommend the use of their Service Centers. Carriers claim that use of the Service Center will speed the transaction for the customer and allow you to minimize staffing. In fact, Service Centers have matured to provide quite good processing service. However, the reality is that most clients will still call their agent (if they remember who you are) first, especially if they have multiple products from you from multiple carriers. In reality, if a client only has the single product (or multiple products) from the Service Center carrier and is encouraged to call the Service Center instead of his agent, eventually he will ask himself why he needs an agent at all. The Service Center promises to cross sell, as well, but while you have multiple carriers with multiple products, the Service Center will only offer their own products, regardless of whether it is the best product and price for the customer. Being Customer-Centric from a service standpoint is to use a service like CSR24 that identifies themselves with your agency identity after hours to provide the same 24/7 service that is the Service Center’s greatest strength but still keeps the agency in the loop and in control over its customers account management. As one agent confided in us several years ago, “We told our personal lines and small commercial clients for five years in a row to simply call the company and, in the end, when we sought to re-invigorate our relationship they didn’t remember who we were. They assumed they were insured by the Carrier, not by a specific independent agency. We lost total control. And we gave up 2 points of commission for the privilege of losing our customer relationships.”

3. Do you sell PRICE or do you sell YOUR ADVICE?

Prospects (and most customers) who call us have no idea what they need or whether they are currently properly protected. The gecko, Flo and the other ‘pitchmen’ have convinced them that the only important thing they should consider is PRICE. So they call us asking for quotes and hoping that we can save them money. It is easy to acquiesce to their request, quote and hope that our price beats what they have now. But, frankly, if quoting was the only thing needed, you and I would be out of work and the Internet would be the primary vehicle for matching clients with insurance products.

It is very hard to convert a price-driven prospect into the beginnings of a trust relationship, the basis of a Customer-Centric agency. But any agent who yields to the temptation to simply quote the customer is admitting that the agency is exactly what the customer expects, a price-driven shop out to sell them something – another ‘used car salesman’ promising to beat any price. You might as well begin your conversation with, “Tell Ya’ What I’m Going To Do!!”

A Customer-Centric agency will quickly get the customer past the price issue (“After all, we have no intention of selling you something for a lot more than you’re paying now. Let’s concentrate on your needs and make sure you are properly protected.”) and spend some time getting to know the prospect and starting the trust relationship that spells the difference between a short-term customer and a life-long client.

Motherhood – Apple Pie – I’m from the IRS and I’m here to HELP you – We are the best servicing agency we can be.

But not all mothers are the saints we would like to portray, apple pie makes you fat, and the IRS is here to relieve you of a part of what you earn. And if you don’t act Customer-Centric in your agency behavior, your mantra would be more accurate as, “WE ARE THE BEST SERVICING AGENCY THAT WE WOULD LIKE TO BE”. Please consider changing your philosophies to perform in the best interest of the client at all times and qualify all you do with the question, “Is this in the client’s best interest?”

If you would like help re-setting your agency to become Customer-Centric, call us at 800-779-2430.