How well do your clients understand their insurance program?

If your answer is “I don’t know, I never asked them”, you are potentially missing a very key element in the sales process.

In the commercial world, most clients probably understand their respective business and the various components necessary to generate a profit and achieve success. In most cases, those same clients do not possess the same level of understanding of insurance and how it works. Agencies have the power to change that.

If I were to tell you that a significant number of your clients would tell you that they really don’t understand their insurance program, what would you do? Chances are you would look to find opportunities to educate them. Imagine having as your marketing slogan “the agency that works to help you understand your insurance”. Sounds powerful to me!

While I am not suggesting you give your clients a test, there are approaches to consider to get a handle on the level of their insurance knowledge. Some initiatives to consider

1)     Ask your clients to complete a survey. This can be done via phone, e-mail or paper. Some agencies may question this approach, but it was interesting to note that when some agencies surveyed their clients, a common response was “don’t assume that we know everything you are talking about”. Most of us live and breathe insurance so we understand it and we probably believe that our clients understand it as well as we do. They don’t! A good opening survey question to consider: “what do you look for from your insurance agent?”. This could determine how you deal with that client.

2)     The proposal. Most agencies draft their proposals using terminology that the agency staff understand. Words like “Replacement cost”, “Co-insurance”, or “Time Element” are used. The agency understands these words / phrases but does the client? Ask the client to explain back to you what “co-insurance” means and you may just get a blank expression. Don’t be afraid to “dummy down the proposal” using definitions and claim examples.

3)     Ask questions of the client. When production staff are communicating with the client (face-to-face or on the phone), don’t be afraid to ask questions such as “do you understand what I just said…I will be happy to re-explain it”.

Helping your clients more fully understand their insurance program (how it works, what’s covered, what’s not, etc.) can be a very powerful tool to achieving a greater level of customer satisfaction. Isn’t customer satisfaction a key indicator of your current and future success? Helping clients understand their insurance program will probably also lead to increased sales of additional products. And lastly, this approach could play a key role in the event of an E&O claim being made against your agency. Actually customer education has been shown to minimize the potential for E&O claims to even happen.

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