Author: VU Faculty
“I recently purchased an insurance agency that has a mix of both standard and nonstandard clients and an overall of 80% personal lines and 20% commercial lines. The agency has been in business for almost 50 years and has been primarily a nonstandard auto agency for a majority of those years. My goal is to bring the agency forward into a multi-line, multi-policy agency with an eye towards a more rounded 60% personal lines (standard only) and 40% small and mid-sized commercial book of business.
“One of my biggest hurdles thus far has been the call volume for price quotes over the phone. We receive nearly 80 calls per day wanting a quote over the phone. Out of that, we are learning that only 1 in 10 calls are from someone that would be qualified as a standard lines client. The rest are non-standard auto price shoppers. We are having to spend a good bit of resources answering phones instead of cross-selling and providing service to our A & B clients.
“What can I do to implement a strategy to weed out these price shoppers so that our personal lines agency staff can focus on cross-selling the standard customers we already have and to focus on acquiring the few qualified risks that call in? Is there a particular script/recording to use stating that we no longer offer price quotes over the phone? What would be my best solution?”
Assuming that there is no law in your state that requires you to provide telephone quotes, we ran this by the VU faculty and got the responses below.
reply followed by a couple of practical “objections” and replies to the
Agency: “Thanks you for calling us for a quotation. While we
formerly provided telephone quotations, our experience is that the best
combination of price and value are achieved for your benefit when we have the
opportunity to sit down with you and make a complete assessment of the risks of
loss that you face and then develop a comprehensive plan that will allow you to
have all of your coverages placed in a one stop shop for your benefit.”
Caller: “Can you just give me an estimate of how much it will be?”
Agency: “The rating for automobile insurance has actually become
very complicated and so it is not possible to give you just an estimate that would
Caller: “You mean you are REFUSING to provide me a telephone
Agency: “We would like to have your business but we are
unfortunately indeed unable to provide you a telephone quotation. We appreciate
your understanding. Would you like to schedule an appointment?”
Caller: “You people really need to get a life. Lots of other
agents will give me a quotation over the phone.”
Agency: “Well, I’m glad to hear that you have other alternatives
that will perhaps serve you on your terms at this time. Our new focus is to
make sure that you have a good outcome at the time of a claim and that is the
reason for our policy position regarding telephone quotations.
general area is my forte having built an agency over 40 years upon the value
concept. The above are just warm-ups for me. There are a thousand ways to
convert to a value based agency and the above will give you a start on how to
shut down the telephone wasted time.
go to our website, www.agencyconsulting.com
to our archives and search for “Asset Protection Model of Relationship Selling.”
It is made to respond to your exact question by stopping useless quoting. In
our personal lines agencies who have adapted and moved from the Quote/Price
Model of sales, any caller requesting a quote is invited in for a consultation
with one of our representatives to make sure the prospect is properly
protected. As you can imagine most people will not agree to this since their
goal is simply to drive a quote to see if they have a good deal now or if they
should jump to your (or someone else’s) policy until their next renewal,
something you probably don’t want to do anyway….Those who come into your office
are good potential clients.
If you would
like some assistance in developing the agency, please give me a call. I will provide
this one thought, you cannot convert a nonstandard to a standard…you will need
to deal with both. I invite your conversation.
What a great
question. The short answer is ‘YES’, you can definitely weed out the
not-so-serious buyers. First of all, you should make sure that the messaging
sent by the previous owner is eradicated. Make sure there is nothing out there
in the public domain that says “call for a free quote” or “click here to get a
free quote.” This sends the message that price is all that matters, and we know
independent agents can’t win that war. Besides, no one actually charges for
quotes, so the use of the word “free” is somewhat disingenuous.
come up with a brief list of questions for your receptionist to ask “prospects.”
Four or five questions should do, and they can do an initial qualifying, such
How did you hear about our agency?
Who is your current agent/company?
How long have you been with them?
When you chose them, what was that decision based on?
Other than price, is there a reason you are thinking of leaving
you get the “wrong” answers, the receptionist can simply say, “It seems as
though you are looking for a lower price for your insurance, and frankly we
have found that our customers end up spending even more money when they buy
from us because we are focused on tailoring their insurance program to meet
their financial objectives. I’m happy to transfer you to one of our personal
insurance specialists who will spend about 30 minutes determining if what we
have to offer is a good option for you.” That should put an end to the price-only
shopper since they know it should NEVER take more than 15 minutes to save them
question and one I deal with all the time but it is not a quick email answer so
if the questioner would like to give me a call, I would be happy to talk with
This will be
a long process to make the transition to a more professional approach.
** ALL** advertising in the public domain that allows the buyer to perceive you
as a non-standard market. When callers request a quote, inquire as to what they
desire, such as an FR bond, or the lowest limits you will offer are 100/300 for
example. Changing the mindset will take time but the rewards will produce the
dividends you are seeking. Advise that you no longer accept late payments thru
an afterhours mail slot…this would also include not accepting payments for
those markets by the agency staff. You risking and accepting a potential E&O
risk as THEIR rules do not bend for late payments! Finally, you could require
that they must make an appointment for such a request. This will then determine
their desire for a professional client for your new business model.
alternative is to open a second shop where you would cater to the buy-here/pay-here
mentality. This can be very lucrative when managed properly.