In the business world it is often said that "change is inevitable, but failure to change is fatal." Nowhere does this statement apply more than in the insurance industry. I can't think of a business sector that is more deeply entrenched in the old way of doing things than insurance. However, in today's highly competitive business environment a company must either adapt to a new breed of customer who hungers for new ways of doing business or the failure of that company is inevitable.
In response to the technology boom that occurred in the 90's most companies undertook expensive overhauls of their obsolete infrastructures and hired entire departments of IT personal in order to "modernize" their companies. Glitzy web-sites popped-up on the Internet that offered the consumer a small glimpse of what the company was all about and offered the agent an opportunity to manage his or her business from their computer rather than calling the home office. All of this was very nice and it probably reduced the overhead of these insurance companies in the long run, but the industry as a whole really didn't change the basic way that it did business. It was still running on the old model of the agent getting in their car, driving out to see the client and making a "belly to belly" presentation and hopefully doing business.
Some companies thought that they could sell insurance directly to the public on the Internet, while circumventing the agent in the field. This was mostly unsuccessful because the only people who "buy" insurance are people who probably won't qualify for it. It is largely true, and probably always will be that insurance has to be "sold" to people long before they ever may actually need it. Hence, the need for the insurance agent prevailed.
One of the most common complaints that I've heard from agents over the years is that they hate doing paperwork. When you transact business on the Internet you completely eliminate the need for any paperwork at all. In this "paperless" environment, the agent's job becomes a whole lot easier and their time can be better spent doing something that is more profitable such as prospecting or actually selling. It also allows the insurance company to significantly reduce printing costs and in the long run it helps them to keep their premium rates competitive.
The biggest advantage of doing business under the new model is that you no longer have to meet face to face with a prospect. This eliminates the wasted time, money, and resources associated with actually driving to meet with the client. One of our agents told us recently that he logged well over 60,000 miles last year in the field. We calculated his annual travel expense to be in excess of $20,000 including wear and tear, gas, oil and insurance costs. This doesn't take into account over 1200 hours of "windshield" time that was, for the most part, unprofitable to the agent. That's a total of 50 full days doing nothing else but driving his car from point A to point B, often times in bad conditions. Agents can eliminate most of this expense and inconvenience by embracing the new model of doing business on the Internet. They will then find themselves with plenty of "found time" that can be used to generate more business or to be with their families and friends.
Under the old model an agent would write an application and send it to their upline manager. Then the business was "scrubbed" by an administrative person and sent out to the carrier, usually on a weekly basis. It would take a day or two to get to the home office and when the business arrived it would sit for a day or so before it was keyed into their system. Then the underwriting process would begin.
The new method of doing business shaves days if not weeks off the underwriting timeline. An agent can write the business and submit it electronically on Monday; if the application is clean it can be issued on Wednesday, and the agent can be paid his or her commission electronically on Friday.
Today's technology oriented prospects are more inclined to do business according to the new model. Most prospects don't look forward to spending several hours with an insurance agent at their home or place of business. They actually dread this process and much that goes along with it, including the perceived "high pressure" that may be placed upon them. Given the choice, many of these potential clients would prefer to do business on the Internet, in the privacy of their home or office, with no outside intruders. This type of customer can be found in the multitude of "Internet leads" that are available to today's agent. These prospects are comfortable on their computer and they don't want to waste any of their valuable time.
It's relatively easy to shift the way that you're doing business from the old model to the new one. It typically doesn't happen overnight, but instead, is an ongoing process that results in the agent doing more and more of their business under the new model as time goes by. Here is an excerpt from one of our telephone scripts that shows how an agent can easily adopt this new method as their own:
"The reason that I'm calling is that you were recently on one of our health care Web sites and you requested some additional information about our health insurance program. We specialize in major medical plans underwritten by reputable companies and offered at extremely competitive rates. In many cases we can save someone 30% or more on their premiums. I'm a licensed insurance agent representing one of the fastest growing companies in the nation."
"The reason for our success is that we've streamlined and modernized the entire process of marketing health insurance. We can do business one of two ways, whichever makes most sense to you. Either I can drive out and see you personally at your office or home, or if you'd prefer, we can schedule what we call a "tele-computer" appointment. I'm one of the few agents in the country that has the ability to conduct business on a fully transactional website. On this "tele-computer" appointment I can show you all the benefits, go over the cost options available to you and even submit the application electronically to the carrier over the Internet. Would you prefer an "in-person" appointment or would the "tele-computer" appointment work better for you?"
You will be surprised at the percentage of prospects that will select the new way of doing business if given the choice. This example deals with health insurance, but the process works just as well for certain life insurance products. All you have to do is get aligned with a company that does business this way and give it a try. That's easy to do because these companies make the licensing process as quick and easy for the agent as the application process is for the client. I think you will find that as you become comfortable with this new way of doing business you will increase your income, you will have more free time to do the things that are most important to you and you will never think twice about going back to the old way of doing business.
Don Duryea is the founder of USA Benefits Group and has 24 years of experience in direct sales and marketing. He continues to enjoy success in many areas including personal production, sales management, sales training and public speaking. A past contributor to the Agent Sales Journal, he is responsible for building and maintaining a national sales force that has produced well over $100 million in annualized premiums.
Don is currently the Divisional President with America's Health Care/Rx Plan which is one of the few companies in the country today that offers a complete turn-key system for an agent to sell insurance directly on the Internet. He is committed to helping his agents make their business easier and more profitable.
USA Benefits Group is currently seeking agents and managers nationwide that want to take advantage of his new way of transacting business. We can be contacted at (614) 791-1070 or e-mailed at firstname.lastname@example.org.