Insurance Referrals: Why Timing Is Everything

Fran Majidi April 11, 2023
Insurance Referrals for Agents

You never want to hit up a client for referrals right after you’ve signed them up for a policy, unless you’ve had several conversations with this person and the conversation flows naturally to you offering to help loved ones. What we mean is that you should be continuously building upon a relationship after the client has signed on for a policy before asking for favors. You need to give the client a reason to want to refer you. You’ve got to be good!

Usually, the client is only insured for 6 months if you’re selling auto insurance. Take those 6 months to show you’re indispensable. Many things can happen in 6 months, and if it’s determined that you’re not giving your client the attention and care they want, you may lose this client, never mind the referrals you’d hoped for.

You need to spend the months following a sale wisely. Start by convincing the client that you’re an important part of their financial wellbeing. The following are some more winning tips as you grow your agency.

Show Up, But Don’t Be Annoying

Creating a relationship with an insurance client is no different from any other relationship. You don’t want to overdo it. Take a month before checking in after they’ve bought a new policy. See if they have any questions or concerns and let them know that you’ll be there if they do. Unless they are complaining, this may be a great time to say, “Hey listen, I’d love to help out any friends or family members by doing an analysis of their insurance needs and rates.”

Timing Truly Is Everything

Referrals are the lifeline of all agents, but the agents who are successfully getting them are paying attention to the sources of those referrals. Not only do you need to do a comprehensive policy analysis on a client and then follow-up to see if they have questions, you will need to apply all the discounts you can find as soon as the client is eligible for them. You cannot expect clients in this competitive environment to stay loyal to you if you’re not being the same. That’s the whole point of having a personal agent. It’s so much easier to ask for referrals after a phone call to a client saying that they’re eligible for a new discount!

Give a Heads Up About Renewals

During your first follow-up, it’s a good idea to tell the client that their renewal date is coming up and that you’d be happy to do a comprehensive policy assessment when that time comes to see if they are fully protected. Also, let the client know that you may be able to get them a better rate based on any changes that may have taken place in the insured’s life or because they did not file any claims. If there are any price breaks that apply, you may be able to use them to keep clients who are ready to bounce otherwise.

The Inevitable

You may go through an entire book of business according to the timeline mentioned above and still lose business. This happens. You will lose clients for a whole list of reasons, mainly pricing. If you haven’t convinced your client thoroughly that the product you’re selling is worth every penny, your client may switch to a cheaper offer.

Some clients are simply not possible to convince or keep. They often bounce from one policy to the next, without batting an eyelash at the cancellation fees that make the new policy even more expensive than the one they ditched. If this client had it their way, they would buy no car insurance at all. He or she probably never considers what kinds of trouble an accident would mean to their finances. They just want to pay as little as possible during the good times.

While this is not the ideal client, you probably already have many clients like this. For obvious reasons, you’ll need to keep bringing in fresh blood to your book of business to offset the clients you will likely lose. To gain new clients, you’ll need to constantly market yourself to new people, and in a plethora of ways.

Offsetting Losses

The best and most cost-effective way of bringing in new business on a steady basis is to buy insurance leads. It doesn’t matter which line(s) of insurance you sell. In today’s competitive market, it’s hard to keep up with competitors without buying leads.

If other agents tell you they’d never drop a dime on a lead, you should laugh. Whether you’re buying insurance leads or if you’re doing your own marketing to collect leads, you’re spending money. And if you sat down and figured out how much you’re spending on paper, business cards, advertising costs, copywriting services and whatever else you’re doing to grow sales, you’d see that you’re spending plenty of cash as an investment in your agency.

Make sure your lead company has been around for several years. Also, make sure they have a generous credit policy so that you will be credited for leads with wrong numbers or ones that aren’t in your region. Even the best lead agencies see bad leads slip through the cracks, but you should receive credit (refunds are rare).

A good lead provider will also work closely with you so that you will see a steady increase in sales.