“Get ’em on the phone!” the strategy that will either rescue or destroy insurance agencies

Repeat it with me: “Ommmmm ….. get ’em on the phoooone.” The most successful agencies in the country operate by that mantra. So ingrained in that belief, their websites, advertisements, and entire business strategy is focused around the singular activity of getting the applicant on the phone. There, the agent has a better opportunity to explain complexities, adjust pricing, offer additional services, and a myriad of other sales tactics. What do these agencies do, however, when an entire class of customers doesn’t want to talk on the phone? We’ll come back to that question in a moment.

Richard John

Similar to lawyers, who represent their clients through the complex world of legal process, insurance agents represent their clients in pairing specific risks with the appropriate insurance coverage. Instead of ‘heretofore’ and ‘hearsay’, insurance agents throw around words like ‘exposure’ and ‘loss ratios’ only to the confusion of our customers. Because, we tell ourselves, these terms and the concepts they represent are a complicated set of gears within the insurance machine.

Here’s the rub … it’s not complicated. But, it’s better if it seems complicated, so the overall strategy — repeat the above mantra again — is necessary.

Let’s be honest, insurance isn’t sexy. It’s not exciting. It’s not even fun. But, it IS necessary and it IS big business. Because of this, hot shot programmers and tech companies stay relatively clear of it. In fact, take a moment to search “Programming for Finance” on YouTube. Whether you take my word or see for yourself, there are thousands to tens of thousands of videos that are specific to using technology to address finance (skewed heavily toward the stock market). Now do the same for “Programming for Insurance”…drum roll… none. There are examples of the practical application of technology in insurance, but you have to specifically search for these, i.e., “Using R for insurance claim analysis”. The more general topic hasn’t yet percolated to the surface of YouTube searches because it hasn’t sufficiently saturated the overall programming scene. The point is this: YouTube programmers, and the topics on which they vlog, represent a ‘buzz’ of technology news and trends. Unfortunately, they are silent on insurance. Insurance, it would seem, lacks the appeal and the application of ‘modern’ solutions.

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You can even see this lack of tech-appeal in the agents themselves. For decades, an agent could build a book of business with a phone and a fax machine, because, the prevailing sales strategy has been to “get ’em on the phone”. The customer is less likely to hang-up on you than they are to click away from your website. The longer you keep asking questions, and the longer you can keep the customer answering, the better chance you have to close the deal. Industry jargon, nuances in pricing, and scores of numbers, codes and prices could all be explained away on the phone. The phone is the equivalent of the magician’s hands.

Even the use of technology is a facade. The websites all tout “free online quote”, but don’t actually provide the free online quote…the customer completes a rudimentary application that is forwarded to an agent, who then calls the customer for more information to provide the quote. All of this, because, even the more tech-savvy agents believe that the best strategy is to just get the customer on the phone. The phone is a magical conduit of sales between the agent and the potential customer.

It’s time to revisit the question I posed earlier…what does the agent do if the customer doesn’t want to talk on the phone?

Studies have shown that more than 90% of millennials own a mobile phone and that 80% of those would rather use it for data than voice, strongly indicating that they don’t want to use their phone to talk, but, do regularly use their phone. All of the time and effort supporting the business strategy to get the customer on the phone, will soon fall on deaf ears (pun intended). What is the best way to reach these new customers? As you may have guessed by the title…”get ’em on the phone”.

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The next generation insurance customer will not be swayed by smooth talk, fruit baskets, and sponsored lunches, but they do expect the same level of services offered to them as are provided by all of their other service providers. Even doctors now offer virtual diagnosis by sending pictures and putting prescriptions on the web. Getting the customer on the phone has a new meaning, but it isn’t to talk.

Insurance agents are one of the last holdouts to make this transition for several reasons: They don’t understand the changes that are on the horizon and think the way they have done business until now will continue, they don’t want to provide the one thing that customers want the most…transparency, and/or they don’t want to make the investment, so will continue the old ways until the moment they can’t.

By the end of next year, over 50% of the workforce will be made up of millennials. Agents must understand that there is a fundamental difference between yesterday’s class of client, who purchased insurance by traditional sales (i.e. person-to-person) and tomorrow’s customers, who want a mobile friendly, self-service buying experience. This will require agents to re-think how they find and engage these new customers, or re-think their retirement plans.

The point is … a person-to-person sales strategy, where the goal for the agency is to either get in front of the customer or get them on the phone, will soon be obsolete. It will be replaced with the strategy to offer more services that applicants and customers can access through their mobile phone. The meaning of “get ’em on the phone” has changed using the phone to talk to the customer, to using the phone to engage the customer through self-service apps and features.

Let me know your thoughts on Twitter.

Originally published at https://snappytechinc.com.