How to Build a Sustainable and Differentiated Sales Advantage

By | August 16, 2021

The biggest problem most insurance people suffer from is they all represent the same insurance carriers. So, at the heart of what the buyer is buying is an insurance policy provided by the major carriers. The policy is just a contract that states what will be covered and what won’t in the event of a loss.

But too often, insurance carriers act like thieves. They have minions to scope out intel, take pictures of their competition’s insurance policy, and send it back to their management. Then, within a few months, they’ll have virtually identical policies as their competitors.

So, as an agent/broker, it’s tough to gain a differentiated advantage from the insurance policy. The only real chance you get is when the incumbent is a real “doofus.” But is this really a sustainable option?

If you take “coverage” out of the equation, you might lean towards selling based on price instead. But here’s the problem: You already know the person with the best relationship has the advantage, aka the incumbent. So, the agent will call their underwriter and says, “if you want this, here’s the price we have to match or beat.”

Hence, we can take “price and coverage” off the table as a sustainable competitive advantage.

Proactive Service

What’s next? Most people will say service but when you get them to describe their services, they tell you about their ability to react to client requests.

“We’re here for you, Randy … Need a certificate? We’ll get it out … Have a claim? We’ll help you get it reported … Bought a building? We’ll help you get it insured right away.” The list goes on, but you get the point. Most everyone does reactive services well, so it’s hard to say that reactive service is a distinctive and sustainable competitive advantage.

So how can you offer more valuable services? It’s simple, instead of reacting with the typical, “we’re here whenever you need,” you want to provide Proactive Services.

What is a proactive service? Well, it’s a service plan that’s clearly communicated to the buyer. Think of it as a service that is preventive by nature.

It’s like changing the oil in your car. You get your oil changed about every 3,000 miles to prevent the oil from getting dirty and wearing out your engine. Or do you wait until the light pops up to tell you instead? You could say the same about changing air filters on your A/C system in the house. Of course, you can wait until they get so dirty that they have to be changed, but that would be reactive.

Here’s the point: Your proactive services will give you a sustainable competitive advantage. You get to control them, not the carriers. And, equally important, most of your competitors don’t offer their services like this.

In a market full of old-school, outdated sales tactics, proactive services are, by far, the easiest and most powerful differentiator for you to win new business. And, if you will take the time to learn them, you’ll be at a considerable advantage when you’re up against even your biggest competitors.

Let me give you another example. Our landscape company has a schedule for us every year. They’ll come by to mow our lawn every week. They have a schedule for putting down fertilizer throughout the year. They have a schedule for putting down herbicide to prevent weeds from coming up in the spring. They have a schedule to trim our bushes and trim out trees. It’s all planned, and we don’t have to worry about it.

But imagine if they were a reactive service company and we’d have to remember to request every one of those services. Meaning we’d probably have to call every time our grass got too high or need our bushes trimmed.

Preventative or Proactive Service

Be honest right now, are you in the preventive (proactive service) business, or are you more of a reactive services agent? Please keep in mind that sending out a monthly newsletter is not a proactive service; it’s marketing, but I’ll get into that another day.

And listen, I’m sure you’ve been taught that you are the real difference. If so, is it your personality? Your knowledge? Is it your network or experience? Maybe it’s all the above. But have you considered this? It’s not about you. It’s about the buyer. It’s about getting clear on what they need that they’re not getting right now from their current agent.

Here’s the point: When you give your services a name and make them tangible, you can leverage them to beat your competitor. But, on the other hand, if your differences are abstract, conceptual, arbitrary, or obtuse, then it’s difficult for a prospect to digest it, compare and reward you for your excellence. So, I encourage you to commit to selling proactive services. Learn them intimately so you can communicate them easily enough that a 6th grader could understand. It’s been proven in every agency, after agency, no matter what size. Your proactive services are the basis for you winning more accounts by broker of record.

About Randy Schwantz

Schwantz is founder of The Wedge Group. Phone: 214-446-3209. Website: Email: More from Randy Schwantz

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Insurance Journal West August 16, 2021
August 16, 2021
Insurance Journal West Magazine

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