Over the years, there have been a host of surveys taken on consumer opinions about Personal Lines insurance. The major question is, 'What would prompt an insured to change agents or companies?'
As you would guess, lower premiums is usually the magic answer. In one Commercial Union survey, for example, as many as 80% of consumers say that they would change Auto insurance for a price differential of $50 or more. A slightly smaller percentage say that they would change if they got better coverage at the same price.
Service-oriented features-having claims settled faster, having one comprehensive policy instead of a lot of different types of policies or having an agent do more of the paperwork-really didn't attract the majority of people to buy (or so they said). It is assumed, although practically impossible to measure, that those types of services retain the sale . . . but they don't make the sale in the first place. And when one considers that the average consumer has a claim only once in six or seven years (when the agent can prove his or her worth), the service function becomes even less of an issue.
But one increasingly important factor was never measured: the method of paying for the coverage.
What if this question were asked: 'Would you be interested in this policy if you could pay for it in 12 easy installments?' Would that have an appreciable effect on the initial sale? How about on the retention? Pretty soon, there will be so many payment plans offered by financial institutions in the insurance business that ease of payment (including credit card usage) is going to be an accepted part of the sale.
What concerns me is the fact that many distributors (agents, producers, etc.) won't have the capability of offering easy payment plans. They won't have it-unless they go out and get it. And the best time to do that is now.
Action Step:
Implement a premium-finance program in your agency.