Attract high-end sales with personal insurance shoppers

The future of personal lines is about picking sides. Today’s average auto and homeowners policyholder is shifting from the middle ground to one of two consumer extremes: low service or high. The former considers insurance to be a commodity and buys from the best marketer at the most competitive price. The latter, who are much fewer in number, are willing to pay for much higher levels of service and protection. Soon, you too will have to pick a side.

The low end

Low service clients believe that price is king. They value premium savings over personal attention and as a result expect only a reasonable level of post-sale service. The millions of consumers who hold these values are increasing in number daily. One reason is because many insurance carriers are now directly marketing to the once-dreaded driver aged 18-to-24. Why? Because as today’s young people buy their policies on the phone, by mail, and online, without interacting with an agent, they’ll have been trained from youth to bypass agents for their adult account. If you elect not to compete for this business, then you have only these alternatives: fight for sales with other agents in the shrinking middle, or take the high road.

The high end

Targeting this market demands a solicitation style that is distinguished from the above.

Still, keep in mind that these insurance consumers aren’t merely the well-heeled. Often, they are individuals who simply enjoy personal service and a feeling of exclusivity; much like flying first-class instead of coach. They are willing to pay for extra protection and attention if it satisfies their vision of value.

Department stores meet this need by providing their customers with the services of a free personal shopper. As a result, they enjoy higher-end sales and more repeat business. Many entrepreneurs have also started fee-based shopping services. They bill an hourly rate to physically shop for their customer’s clothes, gifts, groceries, etc. And their clients aren’t just harried executives, they are also regular folks who prefer to let others do the buying for them, or at least gather the research needed to make a decision.

The personal shopping service path already exists, so why not follow it? It offers advantages to both the insurance buyer and seller, plus it helps to lock out the competition by making your office appear to be indispensable.

To be marketable, a personal insurance shopping service can’t simply be what you normally do with a new label attached to it. It has to offer desirable benefits and present an upscale persona. At least one licensed agent is required with the drive and personality to grow the idea; someone who is a skilled communicator and a real people person. The perks that you offer may or may not include actual rate comparisons among carriers, as the “shopping” aspect centers on the meticulous identification and provision of selected coverages and services. Pricing is a secondary consideration.

Here are some basic examples.

Free services to high-end insureds: An in-person needs analysis, broadest attainable insurance contract with plenty of upgrades, an annual account overview report, a home replacement cost survey with updates, physical organization of the family’s myriad policies, etc.

For-fee services: Video inventory of the family’s possessions, back-up storage of major property receipts, periodic jewelry and art appraisals in cooperation with experts, retirement planning, annual driver and credit reports, etc. (Any fees charged are subject to applicable insurance department regulations.) Note: It’s necessary that your office be each client family’s only insurance professional for this approach to succeed.

Easy sources of prospects

Check the phone book and Web to find personal shoppers in your area. These firms already do business with the type of client you seek. They are also usually small operations that may welcome an alliance with you. Ask them to refer their clients in exchange for recommending their services to your insureds, subject to privacy policies and regulations. Also seek out similar arrangements with the area department stores and malls that provide free or for-fee personal shoppers. Buy links or banner ads on the Web site of each personal shopping service near you. Check the People/Promotions announcements in the business section of your daily paper for leads. Send each desirable prospect a handwritten note congratulating him or her on their promotion. Then follow up a week later with a personal letter that introduces the service. Once you snare just one top exec at a local firm — his peers, and especially his direct underlings, are relatively simple targets to approach.

Conclusion

In the future, personal lines will be sold as either a commodity or as a service. The middle ground is rapidly disappearing. Select your side and focus marketing efforts at one end of the spectrum or the other. Your only real choices are quantity or quality.

Topics Personal Lines