Just how important is customer service for your insurance agency? Vital, say experts. All those critical touchpoints add up: How a client is treated on the phone. The promptness with which they receive an answer. The time spent on hold. The completeness of the explanation. How your team made them feel.
Improving your agency customer service and increasing customer retention by five percent can increase profitability by 75 percent, says Bain and Co., as quoted by Forbes. Add to that the 80-20 Pareto Principal: 80 percent of your agency’s future revenue will come from 20 percent of your existing clients. And you’ll agree – yes, great customer service is imperative.
Why good insurance agency customer service is difficult
Because our industry’s product offerings are largely intangible, commercial clients judge a company based on what they can experience—much of which boils down to the quality of customer service.
These discernible service markers range from the commonplace (How’s an agent’s phone etiquette? How quickly do they get back to me?) to the more intuitive (Can they anticipate my needs? Do they really have my back when push comes to shove?)
When it comes to opportunities to engage with customers, insurers and agencies are somewhat at a disadvantage since providers are traditionally limited in their consumer interactions. Most customers rarely stop to think about their insurance until they have a claim which they want paid practically instantly and painlessly, or their latest statement arrives in the form of a bill or renewal notice… or notice of an upcoming audit.
Moreover, the ease of researching competing businesses online hasn’t done insurance companies any favors. Consumers prefer to educate themselves on product offerings across providers before buying. Between online user reviews and tutorials, a notable transition is shifting the power away from companies to consumers.
How enhancing agency customer service reaps increased retention
The good news? Increasing customer retention is directly correlated to improving profitability. The following tips can help significantly improve your agency customer service and thus help increase customer retention rates:
1. Look to service models outside the insurance industry. Quality customer service is a critical part of any business. Don’t hesitate to look to good role models, irrespective of industry, especially those whose revenue directly relies on providing exceptional customer service. For example, the hospitality industry must consistently provide five-star service in order to remain viable. Implementing some of their customer service benchmarks would provide your customers with the same level of experience as walking into a luxury hotel.
2. Jump on the latest technology. Insurance clients are seeking the same level of support and convenience they receive from other tech-savvy industries in search of an experience that’s mobile, immediate and social. Strive to provide service that allows customers to conduct business on the go, contact you and receive on-the-spot answers outside of regular hours of operation and interact with you and other customers across different channels.
“Invest in technology to make your team more efficient,” agrees Claudia McClain, founder of McClain Insurance Services in Everett, Washington. “Provide multiple monitors (I use three), an intuitive agency management system and comparative rater. Embrace new tools like e-signature and password software. Develop repeatable processes for every step in the agency and keep it available to update on an intranet (we use Sharepoint).”
3. Be proactive with communication. Consumers report preferring to be informed of any changes in advance. Take the initiative to proactively communicate with your customer base to help create transparency and foster trust. Notify them of any changes in service, appointment reminders or any other important industry updates well before they happen.
When asked what his agency does differently from his peers, Kurt Kelley, owner of the Houston-area Mobile Insurance, said, “We focus on customer service and proper communication more than most. For example, don’t presume your email got through to your client or prospect. Always follow up. And when they ask six things, provide six answers. Don’t just ignore portions of their email. Specificity matters, as does customer service skills.”
When hiring, Kurt added, “We test to make sure the candidate rates high on empathy. They tend to be the employees that care the most and thus try the hardest. We can train people on insurance details, but we can’t train them to care or to communicate well.”
“Building friendships and long-lasting relationships is important too, not only to get to know each client more completely, but to continue their renewals each year, and have them recommend me to their friends,” agreed producer Chris Bell, commercial lines agent at Merrill Insurance in Eustis, Florida.
4. Improve employee relations and promote from within. Treating those who work for you with as much care and concern as you do your customers is vital to the success of your company. Foster an environment of employee satisfaction and retention. Offer tangible merit-based growth opportunities to anyone who may want them. Employee contentment and loyalty will lend a new level of continuity to the consumer experience, since happy employees directly lead to happier consumers as well.
5. Invest in both agency customer service and employee-supporting technology. Keep a close watch on industry tools that not only help enhance the customer experience, but also aid with employee performance as they engage with customers. Specifically, consider exploring the following three areas:
- Data: Finding software that can perform data cleansing, validation, deduplication and normalization is critical to ensuring that your data can become a corporate asset, rather than simply information to be filed away and never used.
- Analytical tools: Once you’ve organized customer data, implement a robust analytics program that will help determine actionable insights. Analyzing data will identify patterns and trends that can support product development and create a more personal relationship with customers.
- Consumer communication: After applying data analytics, you will learn how to input data and personalize contact in ways that are specific to the customer’s unique financial situation, demographics and status, making communication much more strategic, meaningful and effective.
Ultimately, the most important thing to remember is that relationships = revenue. By engaging consumers with personalized messages relevant to their specific situations, agents can create relationships that bring about customer engagement, satisfaction and loyalty…and higher revenue.
This article first appeared in Arrowhead’s corporate blogpost, but has been updated and modified to better fit the needs of Valiant producers.