Selling property and casualty (P&C) insurance comes with almost limitless opportunities. You are, after all, selling coverages that almost every person needs by law. Most states require every driver to have some degree of auto insurance coverage. And virtually every mortgage lending company requires mortgages to be backed by homeowners’ insurance. That means P&C agents already have a huge advantage in the world of sales.
There are, however, difficulties that come with selling P&C coverages. With all those opportunities comes a lot of competition. No matter what part of the country you're in, you’re bound to find ample numbers of established P&C agents. At first glance, this fact can be disheartening, but it's possible to get your footing and compete in this market. No matter what market spaces your competition already holds, there’s always a way to make a mark for yourself.
This article provides tips for selling successfully as a P&C agent. Learn how to find a sales approach you can perform better than your competition, an underserved demographic with which you can connect, or a marketing idea you can use to gain an edge.
No matter which insurance carrier(s) you write P&C coverage for, you’ll eventually be faced with higher premium rates than your competition. Insurance rates are like a pendulum: they swing back and forth. One season your premiums for new clients are much lower than your competition, while the next season your premiums are higher than everyone else's.
Since you have a lot of competition as a P&C agent, you can bet that when your competition’s rates are low, they’re doing everything they can to take in new clients.
There are also seasons of the year during which prospects are more likely to purchase P&C coverage than others. During the early summer months, for example, many people purchase new homes, new cars, and new “toys” (RVs, four-wheelers, boats, and more). It can be frustrating if your carrier’s rates happen to be at their peak during prime sales months while your competition seems to get a lucky break at just the right time.
When things you can’t control as an insurance agent (like premiums) feel out of control, it’s important to remember that P&C prospects often make purchase decisions based on more than price alone. According to survey data from Bain and Company, quality service and simplified, streamlined product offerings are two of the primary drivers of customer satisfaction with P&C insurance.
“Quality” when it comes to P&C insurance can be anything from policy coverage details to a person’s relationship quality with the agent. For instance, 63% of consumers tend to purchase from people they like or companies that they feel are aligned with their values.
Follow-ups and check-ins after a client's purchase are also important. Quality of insurance can also refer to claim experience, customer service, or anything else related to purchasing and using coverage.
Price is one-dimensional: You either have better prices than your competition or you don’t, and this can change quickly. But by instead focusing on quality with prospects and creatively finding ways to solve their problems, you pave the way to more long-lasting success.
Use the following tips to think outside the box and create your own niche in your P&C market space.
The sales process doesn’t always follow a pre-set path, but in general, there are seven distinct steps:
The main takeaway for this idea is that if each step represents a point in the sales funnel, you need to make sure there aren’t any bottlenecks. If you’re terrific at steps one through three, but poor at step four, you may not need to spend more time on prospecting. Instead, you should focus your efforts on improving your presentation skills.
If you aren’t already certain where your strengths and weaknesses are, try tracking your stats for three months to get a better idea. If you alleviate your main constraint, you’ll suddenly find yourself closing more sales with less effort.
During the seasons of business when your carrier(s) have the lowest premium prices, it’s time to bring in as many new policies as possible. But even when that’s not the case, just remember that commissions are paid on the total premium sold. That means that when your prices are higher than others, it takes fewer clients in your book of business to maintain or even grow your profits.
When your premiums are high, it’s time to build relationships in your existing book of business. Focus on retaining clients and deepening connections. You can even take high premiums as life’s way of reminding you to slow down and connect with new people in your community and existing policyholders.
When you slow down and spend time with people — say the top 20% of your current clients — you increase the chances that those current policyholders will renew. You can also spend time with people with whom you’ve always wanted to connect, increasing the likelihood that they’ll do business with you when it’s time for their policy to renew.
Another benefit of this approach? It gives you the chance to enjoy extra lunches out or afternoon golf games with people you admire. It’s a win-win situation. Take your carrier's changing premiums as a sort of “winds of fate” that you can use to your advantage. Change your approach with the shifting business environment and you can succeed no matter how your prices look.
As a P&C agent, there are many transition periods in business that you’ll have to navigate. For example:
No matter what business looks like or how you feel, it’s crucial that you keep building your list of prospects. If you need help handling customer service, hire a new customer service rep or a full-time salesperson. If you have to get out into your community more than you already are, make sure you do that. If you’ve lost some drive, do whatever it takes to get your fire back.
The bottom line? When a P&C agent stops prospecting, their business stops growing. If you want to someday have an agency that runs itself on the day-to-day, you need to build your list of prospects every single day.
Closing is just as important in P&C sales as prospecting. And just like hard work in prospecting makes up for lack of skill, the same holds true for closing. Your sales mentor had it right when he said to remember your “ABCs.” That is, always be closing.
The idea of “always be closing” has received some negative reviews lately. Our advice here is to not forget your sales training. Don’t focus only on making money at all costs or forget to build relationships because you’re too focused on closing. That’s not the point.
The point is that on average, salespeople only spend 35.2% of their day actually selling. If you’re anything like your peers, that means you have a lot of extra time during the day that’s not spent on the seven steps of selling. And ultimately, asking for the sale is what pays your bills. Chances aren’t good that you’ll sell a new P&C policy without asking.
If someone isn’t ready to buy, don’t worry about it. Just persistently follow up with them. Sixty percent of customers say “no” four times before agreeing to a purchase.
Build relationships with people, offer them value each time you connect, and persistently keep your services in front of them. When you’re persistent with closing, you naturally improve your closing technique. Eventually, you’ll need fewer and fewer follow-ups to close sales.
This article reflects the features of Nectar as of the date of publication. Features are subject to change at any time. This article is meant for informational purposes only, it is not a guarantee that using Nectar will help you achieve specific business or financial results and is not intended to serve as the sole recommendation for any business financial decisions.