When is an insurance agency more than an insurance agency?
When it’s a successful insurance agency.
According to a recent article in Insurance Journal, firms are discovering that clients are no longer a “captive audience.” In an increasingly competitive landscape, insurance consumers have a plethora of choices, and they’re looking for more than just low prices and broad coverage options.
To truly differentiate themselves, foster consumer loyalty, and grow their businesses, agencies and brokerages must “provide the client with additional services and products that they cannot get from the rest of the insurance industry or other agencies in town: Services and products that the consumer needs and desires, or new ones that they don’t yet know that they ‘need.’”
The authors write:
“These additional services are called ‘value-added services’ and as the name describes, are valuable to the client. Value-added services [or “VAS,” for short] are add-ons to the core services of a business. They have unique characteristics and provide benefits to the client that core services cannot. VAS can be stand-alone products, although they are usually connected to the core service and intended to enhance them.
Increasing customer expectations are the initial driver in the offering and creation of VAS. The major players in the insurance industry react to meet these consumer demands. Insurtech and fintech companies develop new and innovative VAS, which creates new services that the customer did not have before.”
How can smaller firms incorporate VAS without drastically changing their business models and/or breaking the bank? The article recommends starting with “baby steps,” such as sending “an email to clients with a checklist for disaster preparation, especially just before a pending event such as a tornado or hurricane.”
Agencies and brokerages can also “outsource” VAS for clients by engaging with companies that offer customized or pre-arranged value packages, or by collaborating with complimentary service providers (such as CPAs and payroll professionals) to cross-sell to clients.
Is your organization providing your clients with maximum value? Download our free Risk Management Checklist to find out.