Retention toolkit for personal lines agents

With rates continuing to rise all across the industry, more customers are facing the triple threat of higher premiums, higher claims costs and, worst of all, a higher chance of being underinsured. All this, while customers are primarily focused, at least initially, on savings.

So, how can you approach these rate conversations in a way that not only ensures your customer remains protected, but also reinforces your value as an independent agent?

First: explain why rates continue to rise

Then: trust your expertise

General questions

• Did any discounts fall off that can be re-added?
• Were there any mid-term changes resulting in a full-term premium change?
• Were there any added violations, accidents, or losses since the last renewal?
• Is the client getting the best group discount?
• Is there a mono-line, split account, or missing multi-policy credit opportunity?
• Is the insurance score eligible to be re-run?
• Is the insured interested in a paid in full discount?

Auto questions

• Are they comfortable with a higher deductible? $1K for collision is a common selection.
• Is there a change in usage?
• Did you discuss PIP options with your customer? 
• Are there youthful driver(s) on the policy? If so, consider options like good student, student away at school, or the SafeTeen safety and savings program (including TeenSmart, Smart Path or ParentChoice deductible).
• Are there senior or retired driver(s)? If yes, offer waiver of PIP work loss.
• If it’s a single car policy, does the customer own a second car to insure, or have company car?
• Is standard collision an option (ex: older car)? Could collision/comp coverage be changed?
• Are there any safety devices on the auto?
• How many miles are they driving? A low mileage discount up to 15% may be available.

Home questions

• Has their roof been replaced recently?
• Personal property—how much do they need? (Can quote as low as 30%)
• Have you quoted an increased deductible?
• Are there scheduled items on the policy that the insured no longer owns? Are updated appraisals needed?
• Do their service line limits reflect their need? (Can be reduced/removed)
• Does their home qualify for protective device or alarm credits? (Ex: burglar alarm, fire alarm, permanent generator, temperature monitoring device, water leak detection)
• Have they made recent improvements to the home? (ex: finished basement, added a pool)

How would you explain inflation and its impact on home insurance to a customer? Here’s a sample response:

Let’s say you’re cooking and there’s a kitchen fire that severely damages one side of your home. First, there’s the cost of materials (counters, floors, appliances), which has gone up substantially. Then a higher cost to hire contractors to repair your home. Repairs also take longer because of delays in getting the materials.

Now while your home is being repaired, you need to rent a place to stay temporarily so you still have access to a kitchen. Rental prices are up due to lower inventory, and you’d be renting for longer because the repair takes longer. All of this results in a need for higher coverage because the limits you had previously may not be enough in today’s market with everything factored in.

Other insurance carriers across the industry are also adjusting their rates for the same reasons.

 What you might hear: 
“That makes sense for my home. What about my auto price?”

How would you explain an auto rate increase? Here’s a sample response:

In recent years, there was a shortage of chips needed to build new cars. This meant less new cars available to buy, which drove up prices both of new and used cars—up to 40% higher. Let’s say you had a used car worth $10K. To replace it now in a total loss would be $14K. So that you get a replacement of the same year and quality, we’d pay $14K in that instance.

Now let’s say you didn’t have a total loss, but your car was being repaired after an accident. In addition to higher repair costs, it also takes longer to repair cars. If you need a rental car to get around during the repair, you’ll need it for longer. And because rentals are being used for longer, there is lower inventory for those too, leading to higher rental prices. 

All these factors lead to rate increases across the board.

What you might hear: 
“I understand the inflation piece now, but I just can’t pay this much. Everything is more expensive, and I’m not making more. If you can’t lower this price, I need to call other companies.”

How would you respond to this customer? Here’s a sample response:

I completely understand—and you’re not alone feeling this way. I want to respect your time and help you avoid the hassle of shopping around. Prices are going up across the industry right now, regardless of the carrier. Even if you can save a few dollars, many customers see an increase after the first year. I also want to ensure you don’t lose coverage or sacrifice claims service. 

Let’s do this—I’d like to review your policy with you now to ensure you’re receiving all the credits you’re eligible for and that your coverage meets your current needs in case of a claim. How does that sound?

Download a printable copy of this toolkit

Sources: Internal data, AutoRentalNews, US Bureau of Labor and statistics, Zonda, Cox Automotive