It’s astounding how much low hanging fruit there is in today’s insurance marketplace. What’s even more amazing—frankly—is that so few producers today are willing to take hold of that fruit (a.k.a. commission dollars) and make it their own, once and for all!
Train Your Prospective Client
Back when I was a broker, a number of years ago now, I set an initial appointment with a steel contractor located in the east bay area of California. The CFO was a relative of one of the owners and she spent the last few years dealing with headache after headache because of insurance hassles, claims issues, certificate compliance problems, etc.
This company had been with their insurance agent for a few years by that time, but the CFO explained to me that she really didn’t understand “all this insurance stuff,” even though they were paying nearly $400,000 in combined policy premiums each year. The incumbent agent purported himself as a worker’s compensation “expert,” but the insured’s Experience Modifier (Ex. Mod.) was in the 200’s and the CFO didn’t even know what that meant or how it was calculated.
(To this day, I’m still wondering how that agent had the audacity to market himself as an expert in worker’s compensation when his client knew next to nothing about how their Ex. Mod. was calculated and costing them so much money!)
It was obvious that this was a major issue for the CFO, but she didn’t know what to do about it and she assumed she didn’t have any alternatives. I decided to take ten minutes (please note—only ten minutes!) to explain to her how the insurance carrier had determined their final premium for worker’s compensation, and how the Workers Compensation Insurance Rating Bureau calculated her Ex. Mod. factor.
The Broker of Record Letter Is the Most Valuable Piece of Paper in the Insurance Industry
Once I was finished, she told me she learned more in those ten minutes than she had in all the years before then. I then explained to her that I was more than willing to take over her policies through a Broker of Record letter, would service them for the remainder of the policy period, and that I’d personally handle her loss control program going forward in order to do everything that could be done to drive her Ex. Mod. down and save their company money. She happily agreed to do that and signed my Broker of Record letter right then.
One Signature = $50,000 of Commission
As an FYI, that client generated slightly more than $50,000 in annualized commission to me. It certainly wasn’t a blockbuster account, by any means, but it definitely was a profitable account. I maintained that client for the remainder of the time I was employed as a broker, and I was awarded the account because I was willing to educate the client with basic information about what was causing her so much pain and frustration.
You may have some “wins” like that under your belt as well (or wish you could get some of those wins). But what I’ve come to notice over the course of my career as a broker back then, and now as an independent consultant, is that those “opportunities” are everywhere, but so few brokers are willing to do what is necessary to win the insured’s PERMISSION and, ultimately, their business.
The vast majority of your competitors are all too willing to quote on a prospect’s policy renewals, but few are willing to provide the insured with any basic information to help them make a more informed decision. Those brokers falsely assume that if they do provide the insured with the knowledge about how insurance works, the client will actually do something with it (heaven forbid!) and could end up leaving them for another broker.
But that’s complete nonsense.
What those agents don’t understand is that a well-informed client is a happy client, and a happy client is a loyal client. What they fail to realize—and what I teach here at PermissionSales.com—is that educating the insured in the basics of how the insurance quoting process works is—by far and away—the most effective process to gaining more signed Broker of Record letters.