Helping Your Customers Manage Insurance Costs 

As an independent agent, to ensure you can truly assist your customers in managing insurance costs, you need to conduct an insurance review. The review involves asking key questions to gain understanding of your client’s needs and potential gaps, as well as confirm their goals and objectives to effectively build their insurance program. 

Many agents only consider the price associated with a policy which includes the limits and coverages provided; however, the agent who addresses and educates clients on proper liability limits, coverages or adding endorsements to fill potential gaps will strengthen the relationship with the client and create value. Careful consideration of your client’s needs and goals can prevent unforeseen costs by building an insurance policy that helps protect them from inadequate limits or provides additional coverages to shield them from the financial challenges associated with inadequate coverage.  

As an insurance professional, you have a duty to understand the marketplace, carriers, and coverages. The following strategies can help you assist your clients with lowering premiums: 

Compare insurance options with multiple carriers.

Being an independent agent has a significant advantage when you have access to multiple carriers. Being able to compare premiums and identify the right fit with your client on new business or when life changes can help you create value and retain your best clients. This is not only addressing premiums, but ensuring coverage needs are being met per the needs assessment conducted with your client.   

Package or bundle with a reputable carrier.

Packages provide one of the best discounts insurance carriers apply. Package whenever possible. 

Consider removing collision and possibly comprehensive from older vehicles.

It does not make financial sense to have a high deductible and premium on a vehicle with a low actual cash value. There are on-line resources to help determine a vehicle’s value. 

Higher deductibles.

For clients who understand the intricacies of insurance and have the financial means, a higher deductible can save your client’s money and prevent filing smaller claims, which could jeopardize their ability to retain policies and obtain coverage at a competitive premium. 

Whether you like it or not, credit is part of the rating of a policy.

A high credit score is going to position your client for better options and premiums. Encourage your clients to maintain great credit or improve credit scores. 

Look for duplicate coverage. 

Does your client have roadside service with AAA? If so, do they need this type of coverage with AAA and their auto policy?   

Telematics.

Look at this option in a different way. Participating in a carrier’s telematics program is one way your client can impact their auto premium.  These discounts can be substantial – 5% to 40%, depending on the carrier.  It will also improve the skills of the drivers listed on the policy by making them more aware of their driving behaviors.   WIN – WIN!!! 

E-discounts.

Many carriers provide discounts for going paperless, putting billing and policy documents online, removing paper clutter and unnecessary printing and mailing costs. Recommend paperless and save premium dollars. 

Online service capabilities.

When available, encourage your clients to sign-up for online access to their policies and download mobile apps. This can assist your client by having access to billing, ID cards and payment options as needed as well as keeping their policy from canceling for non-payment of premium. Many digital options now include receiving text notifications when a payment is due, or policy is in jeopardy of cancelling. This will add peace of mind for you and your clients as accidental cancellations can cause a lapse in coverage, make it difficult to be reinstated with the current carrier, or result in higher premiums if attempting to remarket the policy.  

Indirect costs.

Be sure to consider indirect insurance costs to help prevent higher premiums or significant out-of-pocket costs.

The following strategies can help you assist your clients with indirect costs: 

Educate your clients on current issues that could impact them financially and can be covered on the insurance policy: 

• Identity Theft or Cyber Security 
• Higher costs associated with new car replacement if vehicle is totaled. 
• Potential out-of-pocket costs associated with accidents in which vehicle is not drivable and extended time frames involving repairs and rental car coverage limits.  Do you have enough rental reimbursement coverage? 

Proper liability limits and coverage limits can reduce potential out-of-pocket costs for unforeseen claims involving auto or property for which your client is held liable. 

• Accidents involving severe bodily injury where client is at-fault.   

Safe Driving – eliminate/reduce possible accidents by providing tips on safe driving 

• Helps retain accident or violation-free discounts. 
• Eliminates accident surcharge for at-fault accidents. 
• Eliminates filing of unnecessary claims to maintain favorable rating such as Preferred. 
• Distracted Driving 

Remember, cost savings can either go back into your clients’ budgets or can be used to strengthen their policies with better levels of coverage to fill in potential gaps or provide better levels of protection. To be successful and create value, agents will have to move from selling on price to creating value by forging a better relationship through assessment, education, recommendations and understanding carrier options.