Preventing Lapses After a Sale

Glen Shelton

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Just closing a sale might not be the hardest part of our job as insurance agents. An even tougher question might be: How do you keep new clients on the books for the first year, and beyond?

When we interviewed agents for our book, it was interesting to see the range of attitudes they had about handling lapses. The topic was an important chapter, and now we decided to dig even deeper into it with our latest blog post. We rounded up even more tips from the agents who collaborated on our book, to give you even more examples of how other agents button-up their sales to prevent lapses.

In this post, we talk about:

• The importance of delivering a policy or at least discussing it on the phone when the client gets the policy in the mail (if you sell over the phone)
• What kind of paperwork you should focus on after the sale
• What to say or do to button-up the sale and prevent a lead from getting buyer’s remorse

To keep the conversation going, I’m curious to hear: What’s your best tip for new agents to prevent lapses in the first year?

Learn How to Prevent Lapses Now!

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We have both an Agency and Independent side so I am speaking from our Agency side. The key to retention in my opinion is a couple things, the first is the relationship you build with the client from the beginning and how that relationship is fostered over time. It is a lot easier for a client to cancel a policy if they don't know who their agent is then if they know you and like you. That's easier said than done. I am not talking about sending a birthday card once a year. All our agents hand write thank you letters to all their new clients, then we have them follow up in 2 weeks to make sure they received their policy and to see if they have any questions, then in 30, 60 and 90 days. I know that sounds like a lot of work and it is. But bear in mind it cost more to get a new client than to keep an old one. Some of our agents do email newsletters, some do mailings, some do phone calls and some do a combination. The key is "Top of the Mind" awareness by your client. If they know you and are thinking of cancelling, 6, 9 or 12 months down the road, they will call us.

We also educate our clients on the product they are purchasing and about the market. We are the experts and we guide our clients thru the process. They know if they have questions, they can call us because we give all our clients great service. Something as small as returning a phone call promptly carries a lot of weight.

Lastly, we always do right by the client. If you sell your client a quality product and look out for their best interest you should have better than average retention and if your client is considering cancelling we had the ability to discuss their concerns and help them come to a resolution. Its not a perfect system but it works for us.
 
We have both an Agency and Independent side so I am speaking from our Agency side. The key to retention in my opinion is a couple things, the first is the relationship you build with the client from the beginning and how that relationship is fostered over time. It is a lot easier for a client to cancel a policy if they don't know who their agent is then if they know you and like you. That's easier said than done. I am not talking about sending a birthday card once a year. All our agents hand write thank you letters to all their new clients, then we have them follow up in 2 weeks to make sure they received their policy and to see if they have any questions, then in 30, 60 and 90 days. I know that sounds like a lot of work and it is. But bear in mind it cost more to get a new client than to keep an old one. Some of our agents do email newsletters, some do mailings, some do phone calls and some do a combination. The key is "Top of the Mind" awareness by your client. If they know you and are thinking of cancelling, 6, 9 or 12 months down the road, they will call us.

We also educate our clients on the product they are purchasing and about the market. We are the experts and we guide our clients thru the process. They know if they have questions, they can call us because we give all our clients great service. Something as small as returning a phone call promptly carries a lot of weight.

Lastly, we always do right by the client. If you sell your client a quality product and look out for their best interest you should have better than average retention and if your client is considering cancelling we had the ability to discuss their concerns and help them come to a resolution. Its not a perfect system but it works for us.

I completely agree that every agent/agency will have a different system for this that works for them.

I am a big believer in an automated follow-up system such as a monthly email (or snail mail) newsletter that will give your clients that "Top of the mind" awareness that you mentioned.

I just posted this in a different thread but I think it really applies here -

"The probability of selling to an existing customer is 60 – 70%, while the probability of selling to a new prospect is 5-20%."

https://www.invespcro.com/blog/customer-acquisition-retention/
 
I see the best way to prevent lapses is to not over sell in the first place.

Find their WHY. Address that WHY and the lapses will go away.

Talking them into something is a lapse waiting to happen.
 
**chuckles**

I was in the midst of creating a personalized form letter to send my clients last night to let them know that "I was thinking of them."

Order extra apps.

I get weekly "call in" from notes I write on term conversion letters, annual reports, service notices and note cards I send out.

Last week I was searching for an old email and ran across an email string with another client. She was a referral. I sent her a short thinking about you email. Am writing her future daughter in law's mother today. I expect this new RN will be a referral source as well.

Edit: one of the best changes I made years ago was asking each contact or quote for their address, email address, cell number and if they text and email. Sounds like a no brainer but I used to not always do it. Now I text and email more than mail. Yes, even my FE clients.
 
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