Insurance agents generally believe they are delivering value to their customers and meeting their needs. However, new research suggests that customers don’t necessarily feel the same way.
Researchers are finding a significant perception gap between insurance agents and their customers on the value, quality and character of their insurance provider. Understanding this gap and how to close it is vital to success, especially as direct-to-consumer insurtechs threaten the traditional client-advisor relationship.
The Perception Gap Between Insurance Agents & Clients
When potential clients make the decision to invest in an insurance policy, it is no small feat. Though an agent may believe that they are giving the impression of being a valuable and trusted resource, agents must also recognize that it is natural for clients to be cautious and critical. Agents must react in a way that makes clients feel secure and know they’re heard. To do this, agents must look beyond pricing to ensure that their policies fit the entire strategy. This can only be done by getting to know the client in depth.
These ideals apply to existing clients as well. Insurance is traditionally a low-touch industry, so, if you’re not in regular communication with clients, how you can be sure that they are happy? If you’ve ever had a client suddenly leave, it is more than likely that such a high-stakes decision was not so sudden for them.
These aren’t just hypotheticals. A recent Nationwide study found gaps between agents and customers when it comes to how they perceive service levels. Major findings include:
- While 95% of agents believe they’re always there for clients, only 79% of customers felt the same way.
- 91% of agents said they can offer the best prices; 74% of customers agreed.
- 94% of agents said they regularly check in with customers to ensure they’re meeting client needs, but just 69% of customers reported sufficient communication.
When customers don’t feel like they are having their needs met, you run the risk of losing their business to other agents. And some customers, especially Millennials, may decide to forego insurance agents altogether and buy from direct-to-consumer insurtechs that have competitive prices.
The key to closing this perception gap is knowing what customers want in 2020 and adjusting accordingly.
What Clients Are Looking for in an Insurance Agent
Price is often a major selling point that insurance agents emphasize, but it’s no longer the “end all be all” of insurance sales. Clients who work with independent agents stated that the biggest advantages of relying on an independent agent were the expert advice, access to the agent, and time saved by allowing the agent to research carriers.
In the same study, 80% of customers said that agents should prioritize the right policy for a client rather than the lowest price, and 77% would buy a higher-priced policy if an agent explained the value.
According to research from Bain, quality and ease of use are the most important factors for insurance customers, but the industry struggles to consistently provide these necessities. For today’s customers, the value goes beyond price. It also includes flexible solutions, positive digital experiences, and communication with their provider.
Loyalty is often built through communication. Insurance providers that don’t communicate regularly are judged harshly by customers during their few interactions. One bad experience can cause customers to sour. On the other hand, providers who consistently engage with customers are more highly rated and have higher customer loyalty.
Many of these interactions happen online, so insurance agents must be able to deliver value not just in person but also in the digital arena. Becoming truly customer-centric now involves a buttoned-up digital experience where customers can easily communicate with their insurance agents, anywhere and anytime, while keeping their data secure.
Bridging the Gap with Insurance Clients
Ultimately, it comes down to trust.
Clients want an insurance agent they can trust to put their interests first, provide personalized service, and keep their information secure. When clients trust their advisor, they are likely to divulge more information about their financial needs, allowing advisors to make even better recommendations and generate more business.
Take the time to think about your practice and customer-centricity. How are you putting customers first, and what can you do to boost your value to clients? Proactively reach out to your clients to see how they’re doing and if their current policy is still meeting their needs.
One of the most challenging hurdles for insurance agents is providing a high-quality and secure online experience. However, powerful insurtech platforms are now available to agents that are allowing them to bridge the digital gap.
Platforms like Link by LegacyShield allow advisors and clients to collaborate in a secure digital workspace. Advisors can easily deliver policy information to clients, and, in turn, clients are able to make changes to files, add information, and message their advisors through the platform. With a secure virtual workspace and file-sharing platform, agents can thread the needle of the services they provide and be “dressed for success” at all times.
To read more about how to build a successful online presence that benefits your clients, read our blog, “Insurance Agents: Dress for (Online) Success.”