How was 2021 for you? Would you say that market conditions in the insurance industry were considered a soft market? There is talk that it is likely that 2022 will be a hardening market for the insurance industry.
Selling insurance in a hard market comes with additional stress due to market cycles, but it also presents opportunities for independent agents. It’s been a long time since we’ve had insurance in a hard market. Books of business have been at an all-time high for years.
For independent insurance agents without experience selling insurance in a hard market, it is vital to have a plan in place to help with client management. With a little planning, it is certainly possible to navigate a hardening market and remain profitable.
As an independent insurance agent selling insurance in a hard market, you must learn to remain calm and to stay focused on what matters: the client. Many consumers will be in for a surprise because of these market conditions. As an independent agent, you know that your property and casualty insurance products sold largely because of price.
Unfortunately, in a hardening market, many clients will face a premium increase or have policy cancellations. As an independent agent in a hardening market, your focus must remain on the clients and how you can best serve them while selling insurance and growing your books of business.
While going through a hardening market, it may be prudent to consider narrowing down your insurance products. This would essentially mean that your insurance agency goes from offering a variety of insurance products in many areas to focusing on a niche. Perhaps that niche is property and casualty insurance products or business insurance.
Choosing a niche in the insurance industry during a hardening market may provide advantages. Primarily, it may create a stronger, more reliable stream of revenue for your agency. Because your focus isn’t spread across multiple types of insurance coverage, you’ll focus on a specific type of insurance product.
You still work with several insurance companies so that you can seek out the best coverage options and prices for your books of business, but your attention is no longer scattered across the board. Doing so may create stronger relationships with the insurance companies and underwriters. This can make the hardening market easier for you to work through.
By focusing on a niche when selling insurance in a hard market, you have the opportunity to become the expert in that area. That is, you become the insurance agent that others think of when they need the types of insurance products that you decided to focus on.
Before you choose your niche, review your books of business. Consider the insurance products your clients need and buy during a soft market, even with increased premiums. There are certain types of insurance products that will always be necessary even in a hard market.
When you’re selling insurance, the true key is to offer the insurance products your clients want and need. If you plan to reduce what you offer because of market conditions, it’s important to put your clients first. Without your clients, you wouldn’t have an agency.
Selling insurance in a hard market is difficult. You must find a way to stand out. It’s not always about flashy marketing and clever commercials. With a hardening market affecting all insurance agents, what can you do to make sure you stand out?
Honor your principles. While having principles in any industry is important, you must maintain your integrity and not give in to some of the cutthroat tactics you may be exposed to by other insurance agents who are looking to get ahead in selling insurance. Remember that your future is in your hands. What you do today will impact your future and your books of business.
During a hardening market, it is important to educate your clients about the renewal process, how a hardening market may cause increased premiums, and how price should not be their only consideration when choosing their insurance products. They should also consider local customer service, claims assistance, and how simple it is to get their questions and concerns answered about their policy.
Kindness, client education, and continuing to offer top-level service to your clients will continue to help you sell insurance in a hard market. Your principles are truly what keep your clients coming back to you and referring their friends, family, and colleagues to your insurance agency.
Not a single person or business listed in any of your books of business are interested in hearing anything other than the truth from you or any of your insurance agents. In fact, there is nothing that will ruin a business relationship faster than a lie.
Your insurance agency can and should maintain its honesty during a hardening market by ensuring that each client gets the truth…even if the truth is hard to hear.
Lying to clients, even by omission, can and will damage the reputation of your agency. Whether it is an increased premium or a change in the renewal process for your clients, always tell them the truth. Coming to your clients with the truth before they are greeted with an unpleasant surprise could save the sale.
Get all the training necessary on the insurance products you sell to become a trusted advisor to your books of business and to those in your area. Because you can become laser-focused and trained in these specific products, you’ll attract clients who are more interested in working with a specialized insurance agent. Clients prefer an agent who truly knows and understands how these products work versus clients who are only interested in the price every time.
Selling insurance in a hard market is much different than doing so in a soft market. It often requires more knowledge, experience, and better relational training than many independent insurance agents have. The good news is that independent insurance agents don’t have to go through a hardening market alone.
SIAA provides all of the training opportunities you need to help you successfully navigate a hardening market. Learn more about your benefits now!