In 90% of the agencies that we visit there is at least one employee that believes that clients only care about price. I can usually get them to admit that it is not true of all clients. I will also accept the fact that there are prospects and clients that only care about price. So the question becomes how do we help the clients understand that price isn’t the most important thing and how do we shift our thought process to avoid selling on price?
The first step in this process is to stop believing ourselves that price is that important. There are a number of reasons why selling on price is not a great idea. When looking at a policy for a client or prospect what do you look at first? If you are looking at the coverages and endorsements, then you are on the right track. If your first thought is to look at the premium, you may be focused too much on price. When a client calls upset about a price increase is your first reaction to shop the policy or is it to review the entire account?
When speaking with clients, we are often holding a mirror up to our own biases including the importance of price. Most of the time when an employee tells me that clients only care about price, I can see it reflected in their approach. When we talk about what went last week, price focused employees will say “I saved a new client $600” or “I rewrote an account from Company A to Company B to save a client money”. Employees that are not focused on price will say “I had a prospect that was written on ACV whom I was able to show why he needed Replacement Cost” or “A client called in upset about a rate increase. I was able to show her how she lost a discount due to a claim last year but we increased her deductible and put her on EFT to bring her back down closer to what she was playing last year”.
Once we believe that we shouldn’t sell on price, we can shift our focus to how to sell on value. Once we believe, we can help the clients understand. The general public has been blasted for years marketing messages telling them that they can name their own price or save 15% in 15 minutes. Even some of our Facebook advertising that I have seen talks about how we saved a client a certain amount of money. We are perpetuating the problem with our marketing and sales approaches.
There are a few things we can do to start to shift the focus off premium and onto coverages.
Eliminate Premium as our Marketing and Advertising Focus
We should not bring up premium as a focus as part of our advertising or marketing. Statements such as “we just saved Bill M. $450 on his insurance” are pushing prospects to believe that premium should be their focus. It also drives our current clients to contact us about remarketing them! Instead our focus should be on coverage and protection. If you feel that premium needs to be a component to make the phone ring you can still reduce the focus by discussing coverage or protection first. “We work with our clients to get them the right coverage at the best possible price” for example. Ideally we wouldn’t even bring up price in our marketing. “We work with families and businesses to provide the proper financial protection”.
Do Not Bring up Premium First
When talking with both prospects as well as existing clients, we should not be bringing up premium first. If the client wants to talk about premium, they will approach the subject. When we are presenting a quote to a prospect, we should be reviewing the coverages and talking about the limits. If you are making a proactive renewal call to a client, you should be focused on doing an annual review, not discussing what the percentage increase is on the premium.
Be Prepared to Pivot off Premium and Back to Coverage
I realize that regardless of our best efforts to focus on protection, many clients are going to want to discuss premium. While we certainly need to address premium and have markets that keep us close, we should always discuss premium as it relates to coverage and protection. Our focus should always be on coverage first. This will help the client understand the value. If we are constantly talking in terms of how much premium a client is saving (or is not saving), we aren’t educating on the coverages. Be prepared to explain why the coverage and limits are more important.
Don’t Email Quotes
This one always starts a debate when I bring it up in a group setting. First, I am not saying never email a quote, but I am saying do not email the quote before you have had a chance to explain it. There are very few people that are going to actually read what you right in the body of the email or review the details of the quote page. They are going to open the attachment, scroll down to the bottom and look at the big bolded premium number and calculate the difference between what they are paying today and what you are going to cost them.
Ideally, you would provide the quote right over the phone on the initial call. Depending on the lines of business, number of quotes, state, rating system, etc., this is not always possible but we should have this as our goal. When not providing a quote on the initial call, after you have gathered all of the information, set a time to speak with them again. Setting this appointment (and then making sure you have the quote and contact them) is vital for you to be allowed to review the quote.
Build Rapport & Trust and Show Expertise
From the very first impression up through presenting the quote, our focus should be on building rapport and trust and showing expertise. People want to buy from people they like, trust, and know what they are doing. Early on in the conversation you can build rapport by showing an interest in what they have to say and avoiding the Insurance Interrogation (shooting off 187 underwriting questions) by gathering the information in a conversational manner. As the call goes along, you build trust and show expertise by clearly explaining coverages that they need and don’t need, talk about how to save money through discounts and higher deductibles, and where they need to improve coverages.
Remember that the more that we focus on price, the more the client will do the same. Clients never leave on price alone. A very common second reason is that they do not understand your value. So if you sell them on price and their premium goes up on the first renewal, what have we done to position ourselves to be the first person that they contact to discuss the renewal? What is preventing them from calling a direct writer that has probably been presenting advertising to them more than a thousand times during that policy term? Show your value so that the client doesn’t only worry about price and knows that if he or she has any concern over their insurance, they need to call you first.