Tell Your Story Often and Everywhere

The insurance marketplace is changing rapidly. New competitors are joining constantly, many looking to leverage technology and transact primarily or completely online. Existing direct response carriers like Geico, Esurance and Progressive Direct are ramping up campaigns to attract more clients.

For many consumers, insurance is something they don’t truly understand and they hate paying for. They believe insurance companies look for any opportunity to deny or reduce the cost of a claim. It’s also a common belief that insurance companies, and the agents who represent them, make huge amounts of money off the premiums they pay. Suffice to say they believe insurance is an overpriced product they don’t like but have to purchase and if they have a loss they believe won’t pay all or part of their claim.

With that cynical attitude why do you think they are easily led to believe the only real indicator for purchasing coverage is price? I believe that’s even further magnified with younger buyers who have very little real knowledge of insurance and a strong mistrust of large traditional companies like insurance carriers.

Let’s get one thing off the table before we discuss what I believe is the most important issue for independent agents or brokers. That is that if you are going to compete in today’s marketplace, you have to make the process of reaching out and working with you as convenient, positive and friendly as possible. If you aren’t willing to make this commitment and truly make it reality, it won’t matter how many consumers you are able to attract to your agency. Today’s insurance consumer is in the “driver’s seat” and they expect to get no less than exceptional service.

So even if you have achieved the goal of being a very attractive, accommodating and friendly place to do business, it won’t mean anything if you can’t attract consumers to talk with you about insurance. You need to overcome the price mentality that is being used by your competition.

You and I know that buying based on the lowest price is not sound logic and can set a consumer up for the potential of having a serious loss and inadequate or no coverage. The issue is how do you best communicate that to potential customers?

It is going to take a concentrated campaign of training and education to get consumers to understand what we know. It will require you training your staff to be able to counter a prospect’s initial inquiries to lower their premium. It will also require a serious commitment by all professional and knowledgeable agents to educate consumers.

There couldn’t be a better time for such a campaign. Agency websites, blogs and social media are a great opportunity to arm consumers with the information necessary to make them a more informed buyer of insurance. How you use these mediums may require some assistance as your message should be informative and not sales oriented. The purpose is to give consumers facts that will help them to be better informed and which will dispel the myth of buying based solely on price. Anything you can do to make it fun or lighthearted will increase the readership on social media.

With that said, I also think that it is important that you explain to consumers the serious problems that can come from a lack of proper and adequate coverage. It’s better if these discussions occur individually with prospects. That doesn’t mean that an occasional reference to a serious loss (with visuals if possible) that went uncovered or only partially covered won’t be very effective. Those types of stories have even more effect when the subject is real and local. Local news stories of serious auto losses, flooding and fires to homes or businesses are great opportunities to drive home the need for adequate and appropriate coverage. When people hear about companies that have been hacked and put their customers at risk, it makes the risk real, especially if they were one of the customers.

I hate to reference value added for independent agents and brokers because the concept has been distorted over time. Real value added is the honest, candid discussion you have with a prospect to make sure they know the risks they face, and they have the opportunity to explore the coverage they need to avoid those risks. It’s acknowledging the importance of a competitive premium but not necessarily the lowest premium. It’s advising them of all the little extra things you do to make sure their account is properly written and stays updated as they move forward. It’s also about the involvement your agency has when that customer has a claim. A claim is the only time a customer gets a chance to see the actual, not perceived, value of the coverage they have purchased.

If independent agents are going to remain as a strong viable market for providing insurance, we—as a group—have to get consumers to see the value of proper coverage supported by exceptional agency support. We need to use every opportunity available to get out the message. We need to call out those companies that market by price and expose them for being irresponsible. That means being strong and resolved in your convictions. It means being willing to show a consumer why price shopping could ultimately put them, their family and their business at risk.

This is the value we bring to the insurance buying proposition. Some competitors understand it and offer a weak imitation of it. Others try to convince consumers to trust the quality and the level of advice and service they will provide directly. For example, does any consumer really believe the company they are directly insured with will openly and actively advise them of available coverage that they hadn’t asked to receive? Independent agents offer a real value and benefit to the insurance buying public. We should be proud of that and challenge anyone who says otherwise. We need to get the message out often and everywhere so we can reverse this risky trend of buying protection based on price.