How to Retain Clients in the Wake of Rising Premiums

April 14, 2022

Advice, expertise, and coverage options are the cornerstone of the independent agent’s value proposition. Assessing the needs of the client, the ability to distill complicated concepts into a concise, digestible conversation and recommend solutions are the framework to building a relationship-based book of business for your agency. Albert Einstein once said, “If you can’t explain it simply, you don’t understand it well enough.”

Repair, replacement and material costs are all rising due to supply chain, labor and social inflation issues. As a result, home and auto policyholders are increasingly examining costs and looking for savings. Most independent insurance agents can expect calls from their clients seeking guidance and a way to control rising premiums — assuming these calls haven’t already begun. This is an opportunity.

These savings-driven conversations with clients might be the first time the client has reached out since purchasing his or her policy (but this should not be the first contact an agent has had with the client since that purchase). Agents should be prepared to offer sensible options, including bundling and discounts as well as providing helpful insight into what is driving the rise in premiums. Below are a few tips on how independent insurance agents can retain business as premiums rise:

  • Set the team up for success: Before clients start calling, agents need to arm customer service staff with educational resources, training and talking points that address clients’ questions from the outset.
  • Educate clients: Preparing clients in advance can help soften the blow of an unavoidable rise in premiums. Part of being an insurance agent means keeping up with trends and industry news and relaying that information to clients. Agents should work to educate their clients by setting up informational meetings, providing them with access to educational resources via their website and distribute those resources on social media.
  • Conduct coverage reviews: When a client is concerned about rising premiums, they want to understand how their policies might be affected and the costs involved. Insurance agents should review coverage with their clients and look for discount opportunities. This should include a realistic discussion about repair and replacement costs ahead of any potential policy changes. Agents can consider different options for clients such as higher deductibles to offset the increased premium rates. Taking the time to analyze a specific policy shows clients that agents are providing tailored care, increasing the chance of long-term client retention.

The key to navigating rising premiums is rooted in support. Insurance agents cannot control the fluctuating premium rates, but they can control how they assist their clients through these changes. If a client believes his or her agent is both informed and empathetic, agents can further establish trust. It’s true, clients presented with higher premiums may be reluctant to blindly trust the process, but an effective insurance agent can help ease their mind with efficiency, expertise and a little patience.