Insurance Customer Retention: 7 Ways to Drastically Improve Customer Loyalty

by | Aug 22, 2017

increase insurance customer retention

Customer retention is the lifeblood of independent insurance agencies.

However, in the modern marketplace, improving (or even maintaining) retention rates takes hard work and intentional actions.

Our most loyal insurance customers are NOT those that don’t call the office. Their lack of engagement is not trust, it’s apathy.

With proactive improvements to customer loyalty we can drastically increase our insurance customer retention.

In episode six of The Show, we explain 7 ways you can drastically improve customer loyalty.

Want to know how to track customer loyalty? Watch 4 Easy Ways to Track Insurance Customer Loyalty.


7 Ways to Improve Insurance Customer Retention

I was supposed to do Episode 6 from Minneapolis where I was the last three days, but Minneapolis gets super-hectic when I’m at the office, so that didn’t happen.

So what you get is a bunch of cuts from my trip to Minneapolis but you get an episode from my house.

Today we’re going to talk about customer loyalty, and in particular, how independent insurance agents improve the customer retention.

We’re going to talk about seven tactics that you can use, seven concepts that you can use, seven ideas, seven things that have worked for me in the past that I hope will work for you in the future.

1) Experience Matches Expectation

Experience matches expectation, which means what you put out in the world, what you say you’re going to do, you actually do it.

If you talk about a focus on customer service, if you talk about a focus on your people, on meeting people’s needs, on white glove treatment, VIP treatment, or whatever it is that you market your business around, whatever value proposition you’re putting out into the world, what your customers get when they actually want to do business with you must match or your customers aren’t going to be loyal.

If you say that you’re going to review their policy every year and you don’t, that’s not matching the experience with expectations.

This is one so many agents do. We all love to talk about how we focus on coverage as independent agents and then the customers we love the most are the customers who never call and just auto-renew.

If you say you’re going to review someone’s policies, review their policies or let them know,

“We don’t review your policies until we see substantial changes either in the market, the coverage, the carrier, or the price. When we see those things, then we review.”

Set expectations and meet those expectations. Your customers will be more loyal.

2) Pick Up the Phone

If you want loyal customers, have human beings pick up the phone.

This is a drum that we’ve been banging at Agency Nation for a long time now.

We listen to so many phone calls, and over and over again, the poorest customer experience comes from the agencies who don’t pick up the phone, who send it to a phone tree, or who send it to voicemail.

Here’s a little side note. This is just a really quick tangent.

If you want to sell more, have the person who picks up the phone be able to sell insurance.

There is nothing more than a gatekeeper who has to try to find the right person who then finds out that they’re really not there and that they send them to voicemail.

If I called to buy a policy from you and the receptionist asked me a bunch of questions that then sent me to a producer’s voicemail, that’s a really poor customer experience.

Everyone who picks up the phone in your agency should be able to transact business.

It’s not easy, but if you want to match the customer experience that people are getting in other places, that’s the way that you have to think.

3) Ask Knock Questions First

This one actually has to do with the onboarding process or the sales process.

If you’re quoting someone’s business, ask them the knockout questions first.

Don’t ask them their address first.

Who cares what their address is?

You can figure out their address at the end.

Ask them for a homeowner’s policy. We ask customers who are looking for a homeowner’s policy if they have a dog. That’s the 15th or 16th question that we ask them.

If you have a Rottweiler, your companies that you could potentially write that business with go from 20 to one and the price goes way up.

Ask the questions that are the most pertinent to whether or not that customer is a good fit for your business.

Ask them early in the process.

Even if you end up selling that business, the person is going to be like,

“You know, I got in. I thought I was getting X and I got Y. I bought the policy because I needed it, but man, I really didn’t love that experience.”

That is not how you build good customer loyalty and it’s not how you match experience to expectations.

When you’re bringing people in, when you’re writing new business, ask the questions that can knock out that business or that really determine whether that client is a good fit for you.

Ask knockout questions first and then get to contact information, phone number, and e-mail, the stuff that you can get at the end that is going to have no impact on the carrier you use or the premium.

4) Shared Values

This one is definitely a little tougher.

Try to connect with your customers on shared values. Try to connect with them on your belief structure, on who you are as a person, on the morality, on your humanity. This could mean the charities that you support.

It could mean whether you’re big into your family. It could mean whether you’re big into your community.

The shared value structure that you have as a human being, if you can present that to your clients in a way that they can choose whether or not they agree with that structure, we want to do business with people who we like.

If people don’t know who you are, if they don’t know the values that make you who you are, especially if you’re a producer, and particularly, if you’re an agency owner, what your agency’s value structure is, if your customers have a misaligned value structure, they’re not going to be loyal to you.

They’re just doing business with you until they can find someone who they do like, who they do share values with.

Shared values build deep relationships.

The only way to do that is to use some of the simple marketing tactics that we talk about all the time here at Agency Nation.

But sharing your values and connecting on shared values with customers deepens customer loyalty and will keep your customers around for a lot longer.

5) Ask What Customers Want

Maybe this one seems intuitive, but I think it bears mentioning.

Ask your customers how they want to be served and then do that.

This is empowering your customers.

Just simply ask them,

“How would you like to be contacted?”

And most likely respond,

“You know, I’d really like to be contacted by text message. Please don’t call me during the day at work because I don’t want to receive phone calls at work. But if you can hit me with a text, I can get back to you super-quick.”

Then you can say,

“Okay, no problem, Sally.”

It’s that easy.

Ask your customers how they want you to work with them, ask how they want to be communicated with, ask what they like and desire out of the experience, and then do those things.

By doing the things that they ask for, they’ll see that you actually do care about them and they’ll want to stay with you because so few people are willing to put themselves out for their customers.

We all just want our customers to do whatever is easiest for us.

When you go that extra mile and you put yourself out at the expense of your customer, that’s where true loyalty is built.

6) Transparency

Just be transparent.

Be as transparent through the process as you can.

Sometimes a lack of transparency isn’t necessarily your fault. You’re not trying to hide anything.

I’m not saying that a lack of transparency means anything nefarious is going on that you’re trying to be under-handed.

Just be transparent with the process.

If they ask you how much commission you make, tell them. If they ask you what other policies cost, tell them. If they ask you what carriers your competitors have but you don’t have in your agency, tell them.

Be transparent.

The moment a customer finds out that you are hiding something from them, even if you didn’t necessarily intentionally hide it from them, they’re going to leave.

They’re going to know that that trust is going to be broken and they’re not going to be loyal to your agency because they’re not going to feel like you’re loyal to them as a customer.

Like I said, a lack of transparency isn’t a conscious decision.

What I’m asking you to be is to be intentional about this.

Be transparent about the insurance transaction.

That will build a deeper relationship with people because most of your competition does not do that.

7) Give a Shit

The seventh way to increase insurance customer loyalty: give a shit.

It’s really that simple.

If you care about your customers on a deeper level, you will do whatever needs to be done.

You’ll talk to them however they want to be talked to.

You’ll change your business.

You’ll adapt.

You’ll increase technology.

You’ll do whatever needs to be done, if you really care about them as customers.

Give yourself, open up, allow yourself to think deeper about your customers, not just transactions, not just,

“I don’t write renter’s insurance policies because I don’t make enough money from them.”

You don’t care about that type of customer so that’s not a good fit for you. That’s fine.

But the customers who you do care about, really care.

When you’re authentic and genuine in that caring, it’s so palpable that they feel it.

It’s an energy transfer.

Maybe that’s a little fluffy and it’s tough to describe to your producers, to your service reps and to anyone else in your agency.

People know when you give a shit and it builds loyalty.

The Rub

Guys, here’s the deal.

Getting people in the door is a huge part of independent agency success, but keeping those customers is just as important.

Never forget it’s the actions you take, it’s the actions that your people take. It’s the things you do, the processes you put in place that create customer loyalty. It’s not about the customers. It’s about you and the things that you do.

So take ownership of that process, use some of the stuff you heard in this video, track a few of the metrics that I talked about today, and over time, I promise you if you’re doing the work, your customer retention is going up.

We’ll see you on the next episode.

Thank you,

Ryan Hanley

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