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Retention, Retention, Retention

​​​We all talk about retention and we know how important it is to realize growth.  However, I have found that many agency owners have no real insight on their actual retention.  Many agents that I talk to will guess and say “95%” without any real sense of how they arrived at that number. 

If an agency sets a goal to grow their book of business by 10%, they need to know their retention ratio.  Using simple math, an agency with a one million book of business with 100% retention only needs to add $100,000 in premium to meet their goal.  While the agency down the street with 85% retention rate needs to work much harder by adding $250,000 to realize the same goal. Knowing your true retention rate is crucial to measuring growth.

Fortunately, many agency management systems can give agencies a snapshot of their retention.  However, like anything else, the information that you pull from your agency management system is only as good as the information that you put in to it.

Another simple way to calculate your customer retention rate is to locate a few key numbers:

Retention Rate = ((CE-CN)/CS)) X 100 

C= number of customers at end of period

C= number of new customers acquired during period

CS = number of customers at start of period 

Once you understand your retention rate, you can accurately measure your growth and proactively plan your strategies to grow your agency. 

Agency owners need to look at retention as a sales strategy.  It is equally (if not more) important than your new business acquisition strategy for every boost in retention will increase bottom line profits.  Studies have shown that $1 paid towards customer retention increases profits by more than $5 spent on new customer acquisition.

Now…how do you improve your retention?

Retaining your customers is based on a variety of procedures that should be set up in your agency.  I recommend that you initiate as many of the below strategies to effectively boost your retention.  Also remember that a retained customer is a strong source of referrals.

  • Put it in writing! First and foremost, your agency needs to have documented procedures on your retention strategies. These procedures need to include that the agency’s outreach is consistent and that every employee is held accountable for delivering an exceptional experience at every level of client interaction.
  • Appoint a Retention Expert in the agency. This person should be the point person that swiftly reacts to any whiff of a potential loss of a client.   The ideal person for this role is someone with a strong sales ability and the authority to negotiate on behalf of the agency.
  • Annual reviews are an agency’s best friend but few agencies actually follow through with this process. An annual review is your way to ‘touch’ your clients and prove your agency’s value.  It can be a 5-minute call that can be used to update information, offer new discounts and necessary coverage advice, cross sell or just remind the client of your referral program.  Always remember to genuinely thank the client for their business and to remind the client that you are a full-service agency representing multiple carriers and there is no reason to ever shop their insurance.
  • Strengthen your onboarding process. Many agents write a new client, collect the new commission and forget it.  Treat each new client as a new member of the agency family.  Introduce them to the agency principal and their customer service representative either in person or by a Welcome Kit.  Send out birthday cards and handwritten notes. By treating the client like family, you ‘marry’ the client to the agency and establish a bond beyond just the sale of insurance.
  • Get in front of rate increases. Many agents would rather put their head in the sand, ignore the rate increase and hope for the best.  But what does that say to your client?  By being proactive on rate increases, you show your client that you are looking out for them.  Set an alert in your agency management system to trigger a suspense for any rate increase over 5%.  Be prepared with suggestions on how to possibly lower the rate or to explain that their actions impacted the rate (ticket, claims, change of underwriting factors).  Remember, an unexpected and unexplained rate increase is one of the biggest incentives for an insured to shop around for new coverage.
  • Offer to shop rates for them. This is a double-edged sword as it can make clients price centric.  However, when you know that a client is unhappy with a rate explain that agency represents the top carriers and you will do all of the shopping for them.  Head off competitor shopping and be sure to share with them the higher rates of other companies that the agency represents.
  • Educate your clients. Anyone can get a price online but when you explain the coverage that they need versus their specific exposure, the more value they will see in your service.  Give claim examples as a way to illustrate the need for certain coverages.
  • Be a claims advocate. This is your opportunity to shine!  Call every client on any claim.  Show your concern, walk them through the claims process and advise if expectations are not met to call you.  The worst place an agent can be is on the wrong side of a bad claim experience.  When clients have a bad claims experience and they don’t tell you about it, they’ll think the only way to send a message to the company is by cancelling the policy.
  • Reward referrals. A reward for referral is just a thank you on steroids!  Who doesn’t like to be thanked and get a small reward at the same time.  Make it meaningful and be consistent.  A socially conscious act can go a long way too.  Donate to their favorite charity, their kids school or their church.
  • Set up automatic payments. Clients on EFT payments renew their policies at a much higher rate.  A rate increase on an automatic monthly payment is much less noticeable and more palatable than a rate increase that is 12x as much on an annual renewal.  Remember that carriers recognize the increased retention on automatic payments and typically charge considerably less payment fee for this type of payment.  Getting your clients on automatic payments is a mini-sale within the sale and should be appreciated for its value.



Written on May 3, 2018 by Peggy Corbett

Are you effectively managing your agency's interaction with current and potential customers?

Sales is the name of the game and actively prospecting is the key to generating new business for your agency.  The utilization of an agency management system or CRM software is the foundation of great customer relationships and should be a major component to your agency’s prospecting plan.  It is the platform that stores customer and prospect contact information, accounts, leads and sales opportunities. 

For the majority of salespeople, finding new customers is one of the most daunting aspects of their job and typically spending 35.9% of their time soliciting new business (Best Practices). 

The application of the tools provided by an agency management system or CRM software needs to be second nature and used daily.  It is critical to enter, scan, record, etc. all data regarding potential clients at the time of contact.  It will produce positive results if you do it routinely.  It will also provide everyone in the agency, including sales, customer service, and business development, a better way to manage the customer relationships and interactions that drive success.  The easy-to-use, customizable dashboard, can deliver a 360-degree view of your customers and prospects, all in one place.

Setting up reminders for yourself will create an automated sales pipeline that will keep you on track for each important ‘touch’ to your prospective clients.  Automated email and text messages will keep your agency’s name in front of the potential client even if they are not a buyer yet. 

Don’t forget to use it to also nurture your existing book of business, create cross sell opportunities and re-visit past clients and lost opportunities.

Prospecting is partially a numbers game but largely based on effort. By utilizing your agency management or CRM tools, you are sure to keep the pipeline full and always have someone that you can talk to regarding your products/services.  

Use your tools and practice every day and you will be amazed at the results!

Written on January 24, 2018 by Peggy Corbett

As we close 2017, what are you doing to bid farewell to the old and welcome the new?

The close of the year should be a time of reflection.  We often focus our efforts on the tasks at hand and the what might be instore for the future.  However, it is equally important to look back and appreciate what went well, grasp what mistakes were made and lastly, if lessons were learned. 

The beginning of a new year is an ideal time to do this as it allows you to take stock of your business and set realistic goals for the year ahead. 

Here is a Year-End to do list:

Get your accounts in order. One of the most important tasks at year-end is to accurately and timely close your books.  Close out your account payables and receivables and balance operating and trust accounts.  Sounds logical, right? If you have good accounting, the process should be a pretty easy task.  Closing out of your accounts and starting the year with organized and accurate balances allows you to understand your previous year’s financial activity as well as insight to any balances that will carry forward to the new year.  

Undergo a Solution Assessment. The end of the year is a perfect time to assess the current systems and procedures that you have in place and see if they can be improved for the new year.  Are you running a solid agency management system?  Is everything being entered the same across the agency?  Do you have a current procedures manual and job descriptions in place for existing staff and new hires?  Agency owners and managers are busy and often caught up in day-to-day management and administration but successful systems and procedures that run the agency are essential to customer satisfaction and retention.  Improving your automated systems reduces wasted time, eliminates potential errors and omissions and increases your ability to focus on your sales pipeline.

Declutter email inboxes. Everyone has that one person in the office that cannot get rid of a single email. What if it might be important in two years?  A cluttered email inbox is the same as a cluttered desk overflowing with papers and files.  It distracts and overwhelms every time you look at it.  At the new year, have your staff organize, archive, attach to agency management files and yes (gasp!) delete unneeded emails.  It seems a very simple thing to do but the psychological effect will be amazing on your staff.  It is certainly one of the easiest ways to increase productivity.  Here’s how:

  • Have staff routinely apply client emails to the agency management file and utilize “delete source” to remove from the inbox.
  • Create filters and rules to automatically send certain emails to specified folders or junk folder.
  • Unsubscribe from 95% of the lists that everyone is on. Most people just delete the unwanted emails but they clog up the inbox every time they are received again.  So, take the extra moment and push the unsubscribe button.
  • Utilize your agency management system ‘reminders’ or your Outlook calendar. Many people leave an unopened or flagged email in their inbox to remind them to do something.  Instead of clogging up the inbox and overwhelming the user, schedule these items properly. 

Motivate your team! Employee engagement is vital to the success of your team and thus, your business.  Start the year of on a positive note by sharing the success of last year.  Ask everyone to set new plans and targets for what they want to achieve in the new year and find out what incentivizes them to do so.   This doesn’t always have to be money.   Also, be sure to give them the resources that they need to do their job well. 

Create New Year goals. Everyone knows that successful business owners should start each year by setting long-term goals.  However, it is equally important to set short-term goals. Short term goals are often overlooked and should be viewed as the steps to achieve the final goal and allow praise in shorter intervals.  It motivates employees to celebrate with more frequent successes.  Also, allow employees to have a word in the goals.  It gives them ownership of the idea and solidifies their participation.   

"The secret of getting ahead is getting started. The secret to getting started is breaking your complex overwhelming tasks into small manageable tasks and then starting on the first one.” ~ Mark Twain

Written on December 14, 2017 by Peggy Corbett

Avoid Employee Turnover Costs with Good Initial Hiring Practice

Hiring good people can be difficult, time-consuming and costly.  Understanding the financial and other costs associated with an inefficient hiring practice will lead you to recognize the reasons to spend time and effort on this vital growth subject.

Hiring the wrong person can be a financial disaster.

Costs are typically 150% of yearly salary

  1.  Lost training time
  2.  Training cost of replacement
  3.  Lost weeks of productivity
  4.  Cost of recruitment
  5.  Stress on organization

Management Headaches

  1.  Conflict with management and other team members
  2.  Disproportionate management time required for problem solving
  3.  Wasted training time
  4.  Starting all over AGAIN!

The core of a successful hiring practice is not the actual interview but in the initial phone conversation with a prospective employee.  Most candidates prepare for the sit-down interview.  They study your website and understand your agency’s products and concentration.  They may even have their practiced “script” ready to use to answer the potential, and likely predictable, interview questions.   However, many candidates are not ready for a phone interview and do not recognize the importance of this piece of the screening process.   As it is more casual and less intimidating than a sit-down interview, you are likely to discover something that you would not find in a ‘practiced’ interview and it is an optimal time to test active listening skills which is key to a productive employee.   Remember that most of your clients will be speaking with this prospective employee on the phone so their listening and response skills are paramount to good client relations.

It is important to remember that you are not interviewing to hire at this point.  This time is used to qualify candidates for the next step in your hiring practice without the additional costs and associated wasted time of a bad in-office interview. 

To begin with, make sure that you prepare the segmentation and questions for the phone interview.  Start by introducing yourself, telling them a bit about the agency and your intent for a specific candidate.  Set the tone and more importantly, the specific agenda for the interview.   Let them know upfront how much time you are devoting to this conversation.  How a candidate adheres to the agenda and the pace of a phone interview is very telling and can be much different from a face-to-face conversation where the candidate can adjust responses and approach based on your body language. 

Be sure to give the candidate the opportunity to acknowledge the agenda and any overt deviation on their part may be a clear sign that this candidate is not for you. 

Wrap up the interview with a clear plan of action by either thanking them for their time or giving them the instructions for the next phase in your interview process.  The follow up should always be on the candidate not on the agency.   Placing the responsibility for follow up on the candidate is the next step of the hiring assessment.   The follow up, or lack of follow up, is a clear measurement of the hirable potential of your next ideal employee.   

Written on October 4, 2017 by Peggy Corbett

Better Business through Good Time Management

Let’s face it. Every one of us is a procrastinator at heart.  The problem with not tackling your biggest problem, most upset client, or worst project first thing in the morning is that it looms over you all day and clutters your mind.  Whether you realize it or not, it creates a distraction for creative concentration.

Mark Twain famously said that if you eat a live frog every morning then nothing worse will happen the rest of the day.

First thing in the morning, your mind is the clearest and you have yet to be pulled in multiple directions. By attacking the most daunting task first, you will have a sense of accomplishment and you can go through the rest of the day knowing that you already ate your frog.

The other time management skills that most agency owners don’t implement are the following:

Track your time:  If you can’t measure it then you can’t improve it.  Knowing how much time to it takes you to complete any given task, will allow you to effectively plan your day.

Eliminate time wasters: One of the most intrusive time wasters is the audible alert of incoming emails.  Every time you respond to that ‘ding’, you are disrupting the concentration of the task at hand.   One recent study shows it takes about 25 minutes to get back on track after you've been interrupted.   Responding to emails is important but it can be done after the completion of a specific project or at designated times in the work day.

Get organized: Organization can be as simple as an uncluttered desk, an orderly email inbox or implementing a viral filing system such as Drop Box to eliminate wasted time looking for paperwork or documents that do not get scanned in to your agency management system. Developing efficient systems will save you a lot of time in the long run.

Set deadlines and keep them: Setting a hard deadline for yourself makes you accountable for the completion of the project. Be honest with yourself and give enough time to realistically get the job done with a little wiggle room for the possibility that other things will get in the way.  If you respect the hard deadline imposed by yourself, your focus will be sharper and efficiencies with be improved.  Remember that being busy isn’t the same as being effective.

Good time management enables you to work smarter – not harder – so that you get more done in less time.




Written on September 12, 2017 by Peggy Corbett