4 Tips for Independent Insurance Agents to Improve PersistencyDec 01, 2022 | 5 MIN READ
Automation is one great way to streamline your business. It saves you time and effort and ensures you’re strengthening your relationships with your clients. It’s a win-win. When it comes to revenue and customer satisfaction, any action that can marry the two is one that independent insurance agents can and should pursue. That’s why automating communication about life insurance policy premiums can be equally valuable for you as well as for your clients.
Unless your client pays in a single premium, keeping up-to-date on policy payments is essential to ensuring the policy stays active and you, as the agent, continue to earn commission. Additionally, these touch points can also help you nurture relationships.
- What is Life Insurance Policy Premium Persistency?
- Why are Life Insurance Policy Renewals Important for Independent Insurance Agents?
- 4 Tips for Independent Insurance Agents to Improve Premium Persistency
What is Life Insurance Policy Premium Persistency?
Whole life insurance policies lock in premiums that must be paid in one sum, over a set period, or even over one’s whole lifetime. These terms are beneficial for policyholders as they enable someone to hold a policy and retain current coverage and pay as they can. Of course, this can be advantageous if health circumstances are evolving or deteriorating as a whole life policy allows your clients to save assets and prepare for the future.
Whole life policies, however, rely on the account holder being up-to-date and paying premiums. The frequency and amount of those premiums depends largely upon the policies terms and, as a result, impacts the agent’s commission. Even with the variable commission amount, life insurance policy sales are essential for insurance agents.
Why are Life Insurance Policy Premium Payments Important for Independent Insurance Agents?
As hinted above, regular life insurance policy payments are a key component of an independent insurance agent’s revenue stream. While initial commissions depend upon the size of the policy, policy payments, especially those paid for a set period or over one’s lifetime. This means that, when it comes to keeping a steady and reliable revenue stream, commission based agents need to focus on policy premium payments as well as new leads.
Prospecting and generating new leads is notoriously time consuming. What’s underestimated is the way that existing clients, especially those who are willing to stay up-to-date with you can help with the prospecting process as well.
While generating new leads can be a challenge, agents have a distinct advantage with existing policy holders and ensuring their timely premium payments because they have established relationships with their clients. If you’re not just maintaining but also nurturing those relationships, acting as educator and advisor to your clients, then keeping them up-to-date should be easier.
Working with your clients on policy premium payments has secondary benefits including:
- Improved client relationships- Through proactive communication, you let your client know you’re thinking about their needs and policy discussions can suggest to clients that you’re keeping their needs in the forefront. Additionally, your personal service differentiates you from large insurance companies where clients may feel like a number.
- Improved client experience- Feeling seen and heard matters. All of the work you do on relationship building means you’ve got clients who feel attended to and that improved experience translates to insurance policy payments
- Improved relationships with policy providers- There’s no doubt that regular premium payments are a boon for your business, but it also helps boost the brand and business of your policy providers.
- Increased business and more referrals- As suggested above, you’re obviously creating a reliable revenue stream, but people who are up-to-date on premiums are also likely to recommend you. After all, they’re happy with your service and business. The referrals they make could bring you even more money with higher margins.
4 Tips for Independent Insurance Agents to Improve Premium Persistency
Thankfully, tips for insurance policy renewals are also transferable in that they’re valuable for your business whether pursuing renewals or referrals.
1. Know your clients
Knowing your clients takes communication. So, if you’ve been following along with our blogs on soft skills and more, you know that listening is half the battle. That means listening not just to their immediate needs but also listening to their concerns, fears, and the other information they may provide. It also means listening to what’s not said and determining, from your client’s interests and the questions they ask, what they might need.
2. Be proactive
If you wait till it’s time to renew, it may be too late. If you’re communicating with your clients regularly, and sometimes that means just checking in, those touchpoints help you build a relationship and, in turn, trust. So, when you make a recommendation, it’s not simply based on your desire to generate reliable revenue, but also to help your client be prepared. It’s also perceived as coming from a place of understanding combined with knowledge of the insurance industry. In contrast, if you wait till the last minute, it seems like an afterthought and is less likely to be well-received.
3. Leverage technology
Your CRM is one of the best tools you have to help you not only stay in touch with clients, but to track and monitor where they are in their customer journey. That means you can set alerts, well ahead of time, and automate messages to communicate about upcoming payments. Further, you can personalize those messages if you’re keeping detailed notes about your clients in your CRM, tailoring the messages to speak to their unique needs and circumstances.
4. Focus on value over price
One of the biggest obstacles to selling policies is the cost, especially when it’s over the course of one’s lifetime and the safety net isn’t as tangible. As a salesperson, you’ll want to focus on the product as a solution and its value beyond the policy. As with all things with a price tag, people looking at the price tag won’t be swayed, but if you’ve been building a relationship with your clients, that can carry you. Talk about customer service, stability, reliability, and the other value you and your partner agency offer to your clients.
The service you provide to your clients is invaluable. That’s why, when choosing the insurance providers you work with, you should be looking for an agency that provides the same level of service you do. That means finding a partner like ELCO Mutual.
Ready to work with an agency that is there when you need us? Our customer service is unparalleled and it’s what keeps our agents coming back. We’d love to discuss not just our products but also our support. Get in touch today!