Acquired business isn’t guaranteed for life. To see it thrive over the long term, you’ll need to utilize some tried and true customer retention strategies.
On average, the customer retention rates of any insurance agent or agency falls somewhere around 85%. That number looks good on paper, but if you have 1,000 clients in a year, that means you lost 150 customers—no small figure when converted to dollars and cents. If this sounds familiar, it’s time to update your customer retention strategies.
Keep in mind that these lost customers probably didn’t hastily choose to leave. If you’re a good insurance broker, your clients will come to trust you. When a customer leaves, it either means that they’ve found a lower price on a policy, or more likely, something has happened to fracture that trust.
Why customers leave insurance companies
There are legitimate reasons for a customer to cancel an insurance policy. Maybe they’ve been offered life insurance through an employer and decide they don’t need a private plan anymore. Perhaps they’ve acquired a new job and have health insurance available at a group rate. Someone may cancel an auto policy when they get rid of a vehicle, or they might discontinue a pet policy when Fido goes to the great doghouse in the sky.
These things are common and there isn’t much to do about them. However, there are other circumstances under which people may cancel policies—circumstances that are not out of a broker’s control. And those factors often have more to do with the broker than they do with the insurance policy. Here is where customer retention strategies become essential.
Customer retention is an ongoing practice, one that requires special attention to each client, organization, and innovation. Schedule a sales demo today to see how our CRM software can help you improve and energize your customer retention strategies.
Customer retention strategies: Be honest
Most people can tell when a salesperson isn’t being upfront. If they can’t, they’ll likely find out. Be upfront with your customers. It will strengthen the bond of trust you share with them.
Customer retention strategies: Focus on current business more than new business
Lead generation is an essential part of any sales business, but not at the expense of the clients you already have. Be in touch with your customers for more than renewals and claims. Even if it doesn’t lead to a sale, it will result in good rapport.
Customer retention strategies: Fewer products, specialized knowledge
Sometimes less is more. Don’t try to sell dozens of different policies that you don’t know much about. Specialize in the products you sell, know them through and through, and demonstrate that expertise with your clients.
Customer retention strategies: Going beyond insurance
Because the insurance industry is so firmly rooted in trust, it’s important to build that trust in ways that fall outside of strict business. Take your customers out to lunch, invite them to corporate events, offer to visit them at their homes. Become a part of their lives and they’ll not only stay with you, but they’ll come to you when in need and most likely, they’ll refer you to others.
Customer retention strategies: Stay up to date
When the Affordable Care Act went into action, people had a lot of questions. Insurance agents were expected to answer those questions. Failure to stay up to date on insurance news and trends can be catastrophic for your business. It may not generate revenue in the short term, but it will be worth every penny in the long term.
Customer retention strategies: Recognize needs
If a customer says they want to cancel a policy, what they’re usually saying is that their needs have changed. Instead of focusing on how to keep that policy in place, listen to those new needs and offer products that meet them. Most people won’t cancel an insurance policy just to save money; they replace it with another policy. Make sure you don’t miss that opportunity.
Customer retention strategies: Demonstrate enthusiasm
Passion draws people to others. If you sell insurance as a means to get by, and you act that way, customers won’t want to stay with you. Don’t be the drab, boring salesperson of stereotypes. Believe in the products you sell and be able to enthusiastically communicate why you believe in them. If you’re excited, your customer is much more likely to be excited as well, and excitement is a great start to a sale.
Customer retention is an ongoing practice, one that requires special attention to each client, organization, and innovation. Schedule a sales demo today to see how our CRM software can help you improve and energize your customer retention strategies.
What customer retention strategies do you use? Share your ideas with our community in the comments.