The dangers of a bid-and-quote approach to insurance buying
Bidding and quoting on insurance policies is a common occurrence in today’s market. Focusing on price is often the buyer’s preferred sales process, yet it can come at the cost of leaving significant shortfalls in their coverage. They likely will not be aware of the underinsurance problem until a claim brings the issue to the fore.
Worse, many insurance agents simply follow the lead of buyers who employ this approach, either because they do not have a more effective sales process to offer, or because they are afraid introducing an alternative will upset the buyer. Unfortunately, all this is likely to result in is a lost business opportunity.
A new approach: lead buyers with risk assessment
On the other hand, agents who are willing and able to lead buyers toward a more effective, risk-assessment-based process can break the dangerous bid-and-quote cycle and even go head-to-head with an incumbent.
Here’s how retail broker TrueNorth partnered with ReSource Pro to enhance the selling skills of its producers and grow its book of business.
CASE STUDY: YOUNG PRODUCER AIMS FOR A PROMISING ACCOUNT
TrueNorth is a retail broker on a rapid growth trajectory driven by specialization in niche areas with complex risk, including contractors in the telecommunications industry. One producer with the company, Will Teubel, is still in the early stages of his career and has been building up his expertise in telecommunications for a few years.
To win a $30,000 revenue opportunity, Teubel would not only need to lead the prospect away from a trusted incumbent, but also away from a quote-based approach to insurance buying.
SOLUTION: PRODUCER TRAINING THROUGH GROWTH SOLUTIONS
To support young talent like Teubel, Aaron Brown, Principal, Construction Practice Leader at TrueNorth, launched an in-house training program and partnered with ReSource Pro’s Agency Growth Solutions.
Using the Disruptive Selling model, Agency Growth Solutions coaches guide producers in developing the confidence and skills to go up against veteran producers holding more relationship cache. The methodology teaches producers an effective sales process, including how to:
- Build niche expertise and technical knowledge
- Develop a value proposition
- Lead prospects through a risk assessment
- Maintain control of the sales conversation and overcome common objections
To capture the new account, Teubel applied the Agency Growth Solutions strategies and went to work, reviewing the prospect’s policies state-by-state to identify areas of concern. During the process, he discovered that their current policies were often holding them back from entering contracts. This meant that although the prospect had saved money by going with the lowest price policy, they were inadvertently cutting off potential revenue sources.
After this discovery, Teubel strategized with Frank Pennachio, Practice Leader at ReSource Pro, through one-on-one calls to determine the best sales approach that would successfully guide the prospect away from a relationship and quote-based approach and toward a risk-assessment based process.
THE IMPACT: WINNING NEW BUSINESS DURING PANDEMIC
When the sales conversation with the prospect turned to bidding and quoting, Teubel leveraged one of the key tenets of the Disruptive Sales Process—take control of the sale—and laid out his terms of engagement: if the sales process was going to be a quote vs. quote arrangement, he would walk away.
After Teubel’s final presentation, the prospect said they had never seen an agent act as a consultant before and decided to give TrueNorth their business by assigning them the broker of record. “That made me feel good, because that’s exactly what we’re trying to do,” Teubel said.
Through TrueNorth’s internal training programs and engagement with ReSource Pro sales coaching, Teubel has grown his book nearly 3X over the past two years and is on track in 2021 to more than double that. In addition, he is now mentoring another young producer.
“The coaching gives me the confidence to go up against anyone in the nation,” Teubel said. “For my niche, I have confidence calling anyone, anywhere about their program, and I believe my team can provide a better service than what they are receiving today.”
READ MORE ABOUT RESOURCE PRO’S APPROACH TO IMPROVING AGENCY OPERATIONS
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