Parting Shots: Leveraging Consumers’ Desire

By John W. MacDonald | February 25, 2002

Imagine positioning your agency as the exclusive provider of all personal lines, to all the employees of your commercial accounts. How the heck do I do that, you ask? By leveraging the consumer desire for convenience into opportunity for your agency.

The examples are everywhere—pay-at-the-pump gas stations, online banking, do-it-yourself checkouts at grocery stores—consumers are looking for convenience where they can get it. Meanwhile, employers are looking for ways to enhance their desirability for prospective employees. The independent agent or broker, can provide both. Introduce multi-company worksite marketing of personal lines to your commercial accounts. Your new clients, the employees of your existing accounts, can enjoy hassle-free insurance payments—a simple payroll deduction for all of their personal insurance. These payments are reduced deposit, no installment charges once in the program, and the employees will never get bills and never write checks.

Imagine being able to offer your independent agent model—with the diverse underwriting capacity, choices and options made available to the general insurance buying public—available to this employee population. Your agency would control the business placement as it does today with your traditional business. Crunch the numbers: ultimately insuring 35 percent to 60 percent, or more, of all the employees of your commercial accounts, at full commission—would this double the revenue your agency derives from these accounts?

Your agency has an opportunity, but it is not going to be there forever. The fact is—there are agents around the country who already are succeeding with this concept, to the tune of thousands and thousands of customers. Their multi-company, single-payroll deduction offerings are popular with employers and employees. They are taking full advantage of their relationships, their entrepreneurial creativity, and technology.

Many property and casualty agents will ask, “What’s in it for the employer?” The answer is common knowledge to those who sell benefits. Employers offer benefits for two reasons: to 1) attract and 2) retain quality employees.

So what would be the ultimate benefit plan? Would things such as no cost, no regulatory issues (e.g. COBRA, ERISA), no participation percentages to hit, minimal administrative responsibility, no pursuit upon termination necessary—ring a bell?

You can provide this ultimate plan. Your benefit program can make available preferred payment terms for personal insurance, from multiple insurance companies to all of the employees. You can run other voluntary products through the same deduction slot—life, short- and long-term disability, voluntary dental, voluntary long-term care, and the list goes on.

The employer can offer a top-quality menu of voluntary benefits to the employees without direct expense, and your agency will manage all of the administration. All the employer needs to do is maintain payroll deductions; your billing system will make this easy for all parties.

To be more successful, an agency needs to combine a sales focus with a billing system that efficiently manages the billing process. The key for independent agents interested in this sort of worksite marketing is an electronic billing system that consolidates multi-carrier, multi-product billing into one payroll deduction report. Agents receive full standard commissions and control the process. The employer, meanwhile, has the administrative simplicity of a single program, while being able to offer employees a diverse menu of voluntary employee benefits.

Agency principals should ask themselves these questions: How can agency time and resources best be deployed in the pursuit of agency business development?; How can the agency position itself to efficiently gain access to large numbers of new, qualified prospects?; and How can the agency take full advantage of the relationships that currently exist and simultaneously box competition out of the picture?

Multi-company worksite marketing of personal lines and ancillary products, from a pure revenue and business potential perspective, must be at the top of the list of ways to energize the agency.

Consumers are looking for convenience, and business-savvy employers are always looking for ways to enhance their desirability for prospective employees. With multi-company worksite marketing of personal lines, your agency can capitalize on these realities, and profit handsomely.

Loren Parsons, president of AMS Services Inc., has spent 25+ years leading agents through their automation. Prior to joining AMS in 1999, he most recently served as president of Silver Plume.

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Insurance Journal West February 25, 2002
February 25, 2002
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