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Value Over Price

Price is always on our minds, and the first thing a prospect often wants to know is how much insurance is going to cost them. With technology now at our fingertips, this usually means people will open their computers (or take out their phones) and start doing their research online, looking for the cheapest options. 
But brokers know that doesn’t give the full picture. How do we encourage customers to look beyond the price tag to ensure they’re properly covered?
Direct-to-consumer online sales are growing in parts of Canada, since many people like the immediacy of going online and getting a quote. In fact, in Canadian Underwriter’s 2019 National Broker Survey, brokers ranked the top two threats to the channel as growth of the direct-to-consumer sales model followed by misperception of the value of brokers.
While there’s a lot of hype around digital insurance offerings overtaking the role of the broker, that’s not turning out to be the case. By having conversations about real-life scenarios with prospects, including those who’ve initially made contact through digital channels, you have an opportunity to demonstrate the value of working with a broker.

Join forces: Use technology to boost your value

While technology is often seen as a threat to the industry, we’re starting to see hybrid offerings that combine the convenience of a digital experience with the expertise of a broker. And despite rumours to the contrary, it’s still difficult to convince prospects to purchase insurance online.
“Our research tells us that only around 20 per cent of people will complete a purchase transaction online. People do their research at home but finish the sale on the phone, with the advice of a broker or a person in a call centre,” said Carol Jardine, President of Canadian P&C Operations at Wawanesa Mutual Insurance, during a panel for the Insurance Brokers Association of Saskatchewan (IBAS).
“People want to talk to people,” she said. “Insurance is a complex purchase. We are insuring people’s biggest assets — their cars, their homes.”
That shows there’s inherent value in what a broker brings to the table, even during digital transactions. But how can you keep the conversation from swinging back to the cheapest policy, especially if a prospect says they can get a better deal online?

Building stronger customer relationships

For many people, buying insurance is something they’re checking off a to-do list. They don’t want to ‘waste’ an afternoon at their broker’s office, and they’d rather spend their money on something else. Whether they’re buying online or sitting in your office (armed with online quotes), you’ll still need to vet their coverage. During this step, there’s a good chance you’ll come across some flags.
For example, maybe they chose the sewer backup coverage, but didn’t opt for overland water. By having a conversation, whether over the phone or in person, you can point out this gap in coverage and how it could affect them. In this case, you can help the client be better protected in the event they discover water in the basement — a more common scenario that people might not fully understand.
Or perhaps your client has not selected Personal Cyber coverage because they don’t understand how that applies to their needs. As a broker, you can explain the numerous ways they might be subject to a cyber attack or data breach. Even if your client doesn’t take the coverage, you can offer your expertise and value-added service by having the discussion before a loss, so they aren’t surprised by a lack of coverage if a claim occurs.

Flip the switch from ‘cost’ to ‘value’

Policies will often have sub-limits that result in coverage gaps. You can provide prospects with knowledge to make the right decision for the coverages they feel are appropriate for them.
Explaining how the wrong policy could lead to costly mistakes could be enough to switch them from ‘cost’ mode to ‘value’ mode. They may not understand, for example, how a simple mistake (like putting down the wrong date) could lead to a claim denial. Having a broker dot the i’s and cross the t’s can give them that peace of mind — which is hard to get with a chatbot.
You can also explain that, in the event they need to make a claim, you’ll be their advocate. Paint a scenario: If their home has been destroyed by fire, would they rather call a human being or text a chatbot? Help them understand that this relationship isn’t just a sales transaction, but one where you work to protect their assets and advocate on their behalf during what could be one of the most challenging moments of their life.

Bringing value to the table

Bringing together the ease of digital with the human touch of a broker is a winning combination, if done correctly. The model that often works best is where the online portal is designed to get the prospect talking to your call centre as soon as possible. Once you have a prospect on the phone, the close ratio is significantly higher. 
But you need to respond to customers immediately. “If it takes a day to respond, that’s too long,” said Jardine. “Every minute that passes between the time someone asks for more information and the time a broker calls them back is a moment where that sale is slipping away.”
In an increasingly digital world, the more you talk about price, the less value you bring to the table. The broker’s role is transforming, and by showcasing a value-added position, clients will see you as much more than a catalogue of prices. Connecting with your customer over real-life scenarios can help you turn a single transaction into a long-term relationship.

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