Making clients valuable to your brokerage for the long term

When it comes to ensuring clients have the right products and coverage levels, life insurance brokers are doing things much better than personal lines brokers. But there’s no reason the P&C industry can’t operate at that level.

You can’t sell life insurance without first conducting a needs analysis for your client. That stage provides transparency, shows consumers how much coverage they need, and protects them from buying products that aren’t right for them.

When you visit the doctor, they don’t automatically give you a prescription because you walked into their office and asked for it. They do a medical examination and then provide expert advice on how to treat the symptoms you’re experiencing.

Good insurance brokers act similarly by completing a needs analysis when onboarding new clients. This isn’t an industry standard yet, but it provides benefits for customers, strengthens the broker value proposition, and can increase sales over the life of the business relationship.

Many life insurance brokers are strong salespeople. This is a necessary skill because their product is something a client can choose to walk away from. People don’t have to buy it, so the need and motivation to buy must be developed.

In the P&C industry, our products – especially in personal lines – have frequently been pre-sold by the government, a bank, a lawyer, or someone else who has determined coverage must be obtained for the client to drive, get a mortgage or run their company.

Because of this, many brokers tend to operate more like helpful administrators than salespeople. We’re happy to answer the phone and give people exactly what they’re asking for without stepping back and getting the full picture of all the ways we can assist the client.

Seek out customer needs

If a consumer doesn’t ask for a specific product, there’s a good chance they’re not going to be fully covered. Many clients lack a holistic view of what they are and aren’t protected against, the different coverages available, or even discounts for which they’re likely eligible. There’s a relatively easy fix for this problem. Do a needs analysis.

Although a standardized needs analysis doesn’t exist for our industry, brokers can create their own. We’re in the process of doing this at our brokerage right now.

Getting started doesn’t have to be difficult. You can begin by asking clients something simple and general like, “Do you own anything valued over $10,000?” The extra knowledge gained helps you offer more tailored recommendations and better compare different carrier offerings on more than just price.

We’re also developing a system to conduct periodic, comprehensive policy reviews with clients. We already re-shop the market on renewal, but this new process is much more in-depth, and includes a needs analysis to make sure customers’ coverage is keeping pace with their changing needs.

The life insurance industry is using needs analyses to do better. We can step up and do this, too.

Adam Mitchell is CEO of Mitch Insurance, a Whitby, Ont.-based insurance brokerage. This article is excerpted from one appearing in the February-March 2024 print edition of Canadian Underwriter. Feature image courtesy of iStock.com/XiaoYun Li