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7 Mistakes New Insurance Agents Make (And How To Fix Them)

Insurance Agent Development
Sep 6, 2022
minute read
Nectar Team
7 Mistakes New Insurance Agents Make (And How To Fix Them)

Becoming an insurance agent gives you a lot to be excited about. It might involve tackling a new adventure, running your own business, or earning more money. With all the expectations you set, it's no wonder you want to get out of the gate fast. You want to put yourself in the best position to succeed, and you probably have a million ideas on how to accomplish your goals.

You have the right attitude, and that frame of mind will benefit your cause. But, you also don't need to run before you can walk. The time leading up to your first day should be used as a learning period. Avoiding some common pitfalls in the insurance sales industry can help you put together a long and rewarding career.

The good news here is that many agents have come before you. Some have failed, and some have succeeded by following certain behaviors and practices that lead to a fruitful insurance career. The bottom line is that if you take a slow, introspective approach to your new career, you can learn a lot from the experience of others to help you get off on the right foot.

Common Mistakes Insurance Agents Make

Let's take a look at some common mistakes new agents make — and how to avoid or fix them.

1. You're not listening

Have you ever been in a conversation with someone who hears almost nothing you say? The only thing they seem to care about is what to say next. This is a common mistake for new insurance agents.

You may be sitting with an insurance prospect, and all you can focus on is your own words and closing the deal. How would you feel if you were the prospect? That potential customer would probably sense that you were just trying to sell something. And that approach won't work.

Practice listening before you start trying to drive the conversation. Let your client do the talking while you absorb all the feedback you can. It might take a few minutes or it might take an hour. But allowing your client to take the lead is a passive strategy that often lays the foundation for a successful client relationship. You're not perceived as pushy, and you've given the prospect a chance to reveal their needs. That's a great first step in the sales process.

2. You're not understanding client needs

To further understand a prospect's needs, you eventually must ask the right questions. You might view products like homeowners and auto insurance policies as entities unto themselves, and not tied to a potential customer's financial situation. However, your job is to protect a client's assets. How can you suggest the proper coverages if you simply try to push policies without understanding how coverage amounts should align with a prospect's assets?

Sometimes probing financial questions can be uncomfortable to ask — especially during the first encounter with a prospect. Here's an idea. Give the potential client a range of amounts and let them make a decision based on the idea that homeowners liability amounts should equal or exceed net worth. Ask a prospect if a number between $300,000 and $500,000 would work, and put the decision in their hands. It's easier than directly asking how much a person is worth.

3. You're not building relationships

Any customers you acquire in the first few months on the circuit will become the lifeblood of your business. With that in mind, don't lose touch with current customers as you seek to obtain new ones. Granted, you need to build your business. From a financial standpoint, though, retaining and satisfying current customers is much less expensive than finding new ones. Customer loyalty also leads to referrals, which is the most affordable medium of advertising.

As your book of business grows, it may be difficult to have meaningful contact with each and every customer. However, being accessible will go a long way when a customer has a question or concern.

Simply keeping your name in front of current clients may help keep your agency relevant in their minds. Automated emails are a simple, low-cost method of staying in constant contact with your customers. Pack them with educational pieces along with tips and tricks on how to get the most value from your services.

4. You're not educating yourself

Sometimes licensed agents feel they have enough to juggle without taking on additional duties. They often pour too much time into building a client base while forsaking personal development.

The insurance industry and its products are ever-evolving. You may be falling a step behind the competition by not staying current with new features and benefits that your carrier is bolting onto its policy offerings. Not differentiating yourself and your services from other agents can put a dent in your sales volume.

Set aside an hour or two per week that's solely devoted to increasing your industry and product knowledge. Every insurance company has a wealth of internal resources that highlight how its policies may suit your customers' needs. There are online tutorials, webinars, and whitepapers out there for the taking. Some of these resources may qualify for continuing education credits, which is a huge bonus and time-saver when it's time to renew your insurance license.

5. You don't ask for help

You may have significant experience in another field or an extensive educational background. But, like any new pursuit, it takes some time to learn the ropes in the insurance business. Yet, you might choose to take on the world by yourself. In doing so, you're likely repeating the mistakes that many experienced agents have already made and learned from. In a sense, you're squandering valuable time that could be better spent on pursuits that will help your bottom line.

There are plenty of experienced agents who have experimented with lead generation, advertising, sales pitches, etc. And many of them are more than willing to share what's worked and what hasn't. You may want to contact a tenured agent somewhere outside your local market (for obvious reasons). More often than not, that individual will be happy to spend some time mentoring a newer agent like yourself.

There's simply no substitute for experience and lessons learned.

6. You're not organized

If you're running your own agency, you may have to wear many hats. Sales, marketing, finance, operations, and perhaps human resources — all those bucks stop with you. You may be focusing heavily on sales while pushing off filing payroll taxes or obtaining your errors and omissions insurance. Either of these mistakes can deal a fatal blow to your insurance career. You don't want to get caught with a large tax liability or you leave yourself exposed to potential legal action.

If time management is not your strong suit, do everything possible to change that reality. Fortunately, in the age of technology, there is a treasure trove of applications that can help you stay on point. Start by leveraging electronic calendars, reminders, notes, and customer relationship management software. Many of these apps integrate and are inexpensive or free. You can also access most of your business from a mobile device.

7. You're chasing the wrong leads

As you'll learn, building a sizable and quality book of business is largely a numbers game. But many agents don't track any metrics or keep score to see what type of return on investment their dollars are fetching.

For instance, you may be purchasing random prospect lists. But is this method actually yielding the results you want? Continuing to expend considerable time and money on a scattershot prospecting approach won't improve your situation. If you also neglect numbers such as your conversion ratios, you won't realize you need to try new ways to acquire customers.

Plan on adding two tasks to your marketing agenda: Find more productive ways to prospect, and measure your results to assess which processes work best for you.

Take Your Next Step on the Right Foot

When it comes to finding customers, the ideal prospect would be looking to switch insurance companies, or perhaps purchasing a policy for the first time. A real-time, warm-lead provider like Nectar can help you find prospects that fit these criteria. Our agents confirm that leads are interested in buying before we transfer them to you — either online or live, right on the phone. These warm leads represent your dream prospect, and Nectar can help you find them.

As a new agent, it's best to get off to a strong start in your new endeavor. At the beginning of your career, excitement and adrenaline may carry you far. However, to build serious momentum, you'll need a constant stream of prospects beyond immediate friends and family. And you'll need to steer clear of some rookie mistakes. You've gotten some advice on the trial-and-error part. Contact Nectar today for a pipeline full of quality leads.

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.


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