The Asset Protection Model

We experienced a huge “surge” of contacts after last month’s PIPELINE article, “DO YOU WANT FRIES WITH THAT,” discussing the cross-selling aspect of the Asset Protection Model. Both e-mails and calls requested more information about the APM and how it works. Of course, APM agencies have already put these principals into action and are converting new clients at a rate that they never imagined before. But so many agents still don’t know the concept that we decided to release our FAQ (Frequently Asked Questions) to provide the thousands of readers a fuller insight into our Relationship Selling Model that acquires clients instead of selling insurance.


What We SAY Is Not What They Hear!! – “Fugedaboudid” Does Not Mean, “Forget About It!”

When we “preach” relationship-driven instead of price-driven client acquisitions many agents hear us say that price should not be important or relevant to a client. WE KNOW THAT ALL CLIENTS ARE CONCERNED WITH PRICE AND, FOR MANY, IT IS THEIR PRIMARY CONCERN!! We (you and I) are like that, too! We don’t like to overpay for anything and we seek price breaks without giving up quality in all of the products and services that we purchase. However, for whatever reasons (there are thousands), we do not buy the least expensive cars, clothes, or food. Other things enter into our buying decisions regarding those things that we feel are important in our lives. I have never heard a friend boasting about going to the cheapest surgeon to have his procedure done, have you??

Why, then, do agents believe that price is the only consideration in clients’ insurance buying decision? Because it is a convenient excuse for not controlling a client relationship!! If price is the ONLY consideration, then we cannot blame our lack of relationship (lack of value added services that make our relationship with a client strong) for clients leaving us for our competitor. If price is the ONLY consideration, it supports our efforts to quote everything with everyone every year seeking the lowest price (and assuming that the lowest price will win).

Our study of insurance agencies over the last 30 years has proven that the greatest relationship builders have the most loyal clients and that those clients will stay with the agent even if the price is a little higher than that of the competition. These are the clients that may use other agents who offer quotes, but will go back to where their loyalty lies to get their insurance coverage. These are the clients that we want for our own agency/clients.

So we developed a Relationship Selling process that acknowledges that most insurance products are generic, that pricing is transitory (sometimes a little higher, sometimes a little lower than competitors) and that the most important things that an agency can bring to its clients are a combination of professional attention to insurance programs and other value-added services that other agents can’t provide.

Our Asset Protection Model also recognizes that commercial exposure is only one (and sometimes not the greatest) of the client’s assets that need protection. Others, while, perhaps not as important or generating as much premium, are as critical to the client as their commercial protection. We all have a favorite story about the crisis reaction of an important client to an uninsured (or underinsured) loss of relatively minor proportion (compared to the value of his business). So a part of the APM is the mandatory review of every insurable (and many uninsurable) client assets.

We all recognize that referral business is much more likely to bear fruit than walk-in or solicited business. So our APM concentrates on getting at least one referral per customer every year within our schedule of visits.


What Is It?

The Asset Protection Model (APM) is a radical change in agency operations and relationships with both current and prospective clients. It converts agencies from price-driven quote machines always trying to ‘get it cheaper’ as a method of gaining clients to relationship driven businesses becoming true consultants to the clients, whether the APM agency writes the insurance account or not.

How Is the APM Different from the traditional agency?

The APM will make you different than most of the other agencies (and direct writers) in the U.S. The most visible change is the elimination of quoting. Agents who claim that price is the only objective of the insurance customer are not candidates for the APM. The next most prevalent change is the increased level of activity and dedication of producers. Every producer must be dedicated to establishing and maintaining relationships with clients and prospects. Successes are defined by the conduct (and resultant documentation) of sales calls with prospects and clients, each delivering value-added services most of which are not even available from competitor agencies. Ten to twenty sales calls each week is not unusual for APM producers. Clients and prospects are visited at least four times each year (or as often as they desire agency services). Producers do NOT service or market accounts — they are dedicated to relationship building and maintenance (the strength of most good producers).

Is the APM a Quick Fix to my production problems?

NO, the APM is NOT the magic bullet that will give you immediate results – it takes training, hard work and commitment. If you have “RIP” (Retired In Place) producers, they will not easily convert to a results-based, activity-required system like the APM.

Like any behavior modification (i.e. changing eating habits for life to reduce weight and mass), APM changes that are made slowly and in a disciplined manner will last while changes that are made fast will fail. The measuring stick of success of the APM is the number of sales calls that are made weekly and the development of relationships from those sales calls (as documented by Call Reports and the enriched Prospect and Customer Relationship Data Bank). Whether used for one producer or for an entire agency, the extraordinary success of the APM will not be fully reflected for as much as three years (although client conversions will be made during the first year, as well). The agency must stand ready to support its producers (if they are doing the right things consistently) for that period of time before the steady flow of successes become prevalent.


Relationship Selling is a misnomer. The word “selling” should not be in the title. A better title would be Relationship Acquisitions defining how the agency is to acquire new clients through the evolution of strong relationships until the client, himself, insists that the agency become his representative for insurance programs.

We already know that agencies’ best customers are ones with whom the owner (or producer) has developed strong business relationships. Every agent tells us of clients who trust the agency so much that they don’t go “shopping” for insurance every year. They simply count on their insurance professional to do the “right” job for the client. Unfortunately, most clients don’t fall into that category of “strong relationships”. The rest of the clients have chosen the agency because they brought them a better price for the insurance product. And, unless a relationship is built after the sale, they tend to shop and potentially leave the agency when a still better priced product becomes available.

The APM avoids the purely price-driven client in favor of the clients (of other agents) who are very loyal and resist any other agent (including our own) competing with their insurance agents. The APM promises to deliver value added services including analysis of all insurance risk to assets, but to neither quote nor accept the prospect as a client until the clients understands the difference between the incumbent and the APM agency.

The APM training teaches producers how to establish relationship and avoid price-competition. Simultaneously, it teaches service staff how to support relationships by word and deed, no longer acting as highly paid message takers for the producers and owners. The APM rewards the producers with strong commissions. But it also rewards service and administrative staff with incentive compensation built on their assumption of full control of the service load for their book of business.


When we train APM to producers and to agency staff we stress that the goal of the agency is to MAKE SURE THAT THE CLIENT’S ASSETS ARE PROTECTED, not to sell them insurance. Once you allay the client’s suspicion of your analysis (by assuring them that you will neither quote nor write the client’s insurance account unless the client asks you to become their agent) the client is much more open to the analysis and you can praise good insurance programs as well as critique coverage issues. Of course, you actually have to mean what you say – don’t quote their insurance. If you reverse yourself, then they consider you “just another insurance agent trying to sell me something”.

Asset Protection is not a matter of one line of insurance. So, regardless of the results of your initial analysis, if you’ve properly explained the uniqueness of APM and your agency, you will establish a follow-up appointment to review the next form of asset evaluation (personal lines, long term care, life insurance, health insurance….) with yourself or with the most logical person in the agency to accomplish this. The second evaluation is followed by as many as needed to assure you that you have reviewed, analyzed and made recommendations for all of the client’s insurable assets. If the client refuses, that’s fine. You’ve made the attempt and you so note in your file. But you will continue to offer because without full access to all assets for review YOU CAN’T PERFORM THE EXPANDED VALUE-ADDED SERVICE OF AN APM AGENT for that client.


As insurance agents, we have naturally become fixated on “insurable” risks. However, many clients have un-insurable risks to their assets associated with their businesses or with their personal life. While we do not make a fee or commission for identifying and assisting in the protection against uninsurable risks, it is a class of risk that needs to be addressed and, in most cases, is woefully lacking among most business owners. For instance government regulation requires adherence to federal standards for business owners. Most small business owners either aren’t aware of the regulations at all or know what acronyms like FMLA, FLSA, EEOC, ADA and IRCA stand for but don’t know how to adhere to them. APM agents are taught the details of these important regulations to the employers and can audit and correct manuals and procedures to help clients avoid a myriad of fines and penalties from the government and lawsuits from unhappy employees. Other loss control, employee benefits and safety modules exist to further add value to your association with client companies.


Even our best producers have grown up in our industry as price-quoters. “Let us give you a quote” is a great incentive for the prospect to interact with the agency, but in most cases (average agency hit rate on quotes is now 12%) a very poor way of spending agency time and money. The APM concentrates on re-training producers into ways of establishing and strengthening relationships without EVER talking about quoting and, in fact, refusing to write a prospects insurance until and unless the client desires the agency to be their insurance consultant for all lines. Even if the customer thinks he’s doing us a favor by allowing us to write one line, he is diminishing our position as his APM consultant if we become “another” of his agents. Similarly, we refuse to quote one or a few carriers against other agents because it brings us down to their level of competition. We would rather evaluate those proposals and counsel the client toward the best of the group. In that way we become the “trusted advisor” and will eventually acquire all of the client’s insurance program.


Producers continue to be compensated based on the revenue base for which they are responsible. The APM only works if the result is strong enough relationships to assume permanent control of client’s insurance programs. However, a producer’s compensation in the APM model is more stable (a monthly compensation based on the commission size of the producer’s book of business in the last year) and is sensitive to growth (providing bonuses during the year in which sales are made) and level of sales call activity.

Sales Call Activity as a baseline for compensation is unique to the APM and assumes that if relationships are created and strengthened through visits several times each year, that the results will be new clients from those relationships as they mature. Every relationship matures in its own time. We know it is “ripe” when it ‘falls from the tree’ – the prospect asks us to become his agent. If we try to pick the fruit before it’s ripe it will not provide the taste and nutrients we expect and there’s no way to re-hang the fruit on the tree. So we continue to build the relationships and document the growth until it ripens on its own.

The APM has a unique feature that is a Self-Terminating Producer Agreement if a producer does not follow through with the relationship building as directed. A relationship not pursued will quickly spoil and be useless. It must be pursued and nurtured at least four times each year to mature properly. If the activity levels are not maintained, the producer acknowledges that he is less likely to convert that client and will find his monthly compensation reduced. He can certainly regain his compensation position by a resurgence of contacts (we are not interested in reducing compensation unnecessarily). This compensation adjustment is in recognition that only the producer, himself/herself can motivate themselves to be active. If they are not active enough to mature the prospects into clients, they should not expect to be paid based on the expectation of a high percentage of conversions.


Producers are not to be treated like children, having to account for every moment of the day. Their activity reports will tell the agency how effectively he has spent his time. Every sales call must generate a Call Report that is used simultaneously as a tickler for future events for that prospect and to build the prospect file with intelligence about the account. Producer compensation is dependent upon the delivery of Call Reports on every physical sales call and a Monthly Activity Report that will determine whether the sales call volume is sufficient to justify his salary or draw.

A Warboard is developed for each producer listing all developing relationships and where each stands in terms of services provided to show them our added value as an agent.