The first question is 'Do you know what the customers want?'
If your answer is 'They always want the lowest price and immediate service,' you're probably right-but is that what they really want? Is that all they want, or is that what they feel they must request to get fair pricing and reasonable service?
Few agents ask their customers what was most important to them in selecting an insurance agent or carrier. The ones who have found surprising answers. Of course, price is always a major concern for customers. We have spent many years convincing the customers that the premiums we charge are not necessarily the lowest available. How? If they get a lower premium from a competitor, we suddenly meet or beat that price ourselves. How do you think our integrity fares in this type of competitive atmosphere?
Aside from price, an agent's or carrier's reliability, honesty, and efficiency rank very high among consumers. Focus groups define reliability as the availability of the decision-making agent or representative when needed-always. Unfortunately, in the eyes of the consumer, 'always' sometimes means beyond normal business hours. Thus a number of agencies have adopted live answering services to refer emergency customer calls to dedicated agency employees after hours. The person at the answering service informs the customer of normal service hours and asks if the call is an emergency. If it is, the person forwards the call (via message) to an emergency number.
As already noted, clients sometimes mistrust producers for reasons of price. You may be friends with your clients, but don't assume that they believe you when you tell them you've marketed their products and have achieved the best price available. This is a difficult situation. One of insurance customers' desires is for the independent agent marketING their insurance annually to get the best value for their money. Most agencies can't afford to do this, at least not every year-but few agents are honest enough to tell the clients this bitter fact. The amount and level of work required by a customer service department in a Commercial Lines agency today makes it prohibitively expensive to market to all carriers every year. The carriers don't like it (unless you price it inhouse) because it takes up their time. Your service staff hates it because they know that they're probably spinning their wheels. All of the markets they shop but one will be judged unworthy. Meanwhile, other critical service remains to be done; your customers are finding themselves poorly serviced!
So a decision must be made regarding the pricing and marketing of clients' products each year. The most successful agencies coordinate this activity through their renewal meetings at which a team (comprised of service, sales, and management personnel) determine how to handle the client each year. A a few unique agencies have involved their most important clients themselves in this decision-making process. This is the height of honesty, and has resulted in a much closer relationship between the client and the agency. Seeing the level of effort being exerted on their behalf, the clients are satisfied that the agency is doing everything possible to manage the account.
The final key issue, efficiency, is much more amenable to the agency's control. Most employees tend to hide their mistakes for fear of retribution if the mistakes are identified. However, most of these mistakes are initially identified by the client themselves. While you, the agency owner, are unaware that anything is amiss, your clients are calling your service team and asking why transactions haven't been completed or completed incorrectly. The solution to this problem begins with careful management of the servicing process. A manager (or owner) should review the mail daily to identify transactional errors. Every customer complaint should be given highest priority, since, like an iceberg, one customer complaint may well represent a hundred dissatisfied customers. Annual customer satisfaction surveys can alert you to potential problems. Close supervision of CSRs may discover one working much harder than another to accommodate the same commission volume or number of customers-another red flag.
As independent insurance agents, we must balance what the customers need with what the customers want. Customers who are forced to buy what they need do so begrudgingly, not gratefully. A part of our job is to convert those needs into wants by showing the customer the benefits of your product. However, if you did not fulfill the customers original wants, you'll find yourself losing customers regardless of the quality of your agency. Do customers want low price? Of course! But no one has the lowest price consistently. Agencies who set themselves up to offer nothing but low-price products can't afford the high grade of service expected from their VIP products.
Some agencies send their customers a checklist, identifying five to 10 issues ranging from frequent communication between agency and client to speed and accuracy of transactions. The checklist asks for clients to rank the issues from most important to least (1 being the most important). Others put out a Customers' Bill of Rights outlining what, in the agency's opinion, the customer should rightfully expect in terms of service. Both methods attempt to pinpoint areas of service that will differentiate the agency from its competitors and transcend price alone as a consideration for the agency's customers.
These measures are commendable and should be combined with a Customer Satisfaction Survey (CSS). The CSS asks the customers to assess the agency's service levels and name the services most important to them. This tool requires a certain degree of confidence in the agency. Regardless of the results, a CSS will help the agency progress as a service organization in the eyes of the customers.