Challenges Facing the Independent Agency
— Carrier direct sales. Online quoting. Carrier web sales.
Our experience in working with Independent Agencies like yours spans many years, and your recent feedback further informs us of your concerns in a difficult and highly competitive market.
Most Agencies’ Priorities Include:
- Acquisition of new business
- Retention of existing business
Most Agencies’ Competition Concerns include:
- Carrier Direct Sales (now claiming over 60% of the individual auto market)
- Online Quoting Services
- Carrier Web Sales and Call Centers
Most independent Agencies are set up for new customer acquisition. Acquisition is easy to measure. You can count the new customers on your database.
Customer retention is harder to measure. How can you prove that, as a result of your efforts, X-number of customers did not drop their coverage last year? Not easy to prove.
At the same time, retention can be very cost effective. Many studies have shown that $1 paid towards customer retention increases profits by more than $5 spent on new customer acquisition.*
Two strategies are simultaneously employed in the “Life Supports” program to achieve the twin goals of increasing customer acquisition and retention. They are:
- Selling Additional Product(s) to Existing Customers
- Communicating Consistently with Existing Customers
* “Increasing Insurance Customer Retention” ~ by Arthur Middleton Hughes Database Marketing Institute ~ August 2012
- "78% of customers prefer to be advised on multiple types of insurance." *
- "53% of customers prefer their Life Insurance come from the same agent as their P&C." *