Telling Client to Take a Hike ???

[VolAgent]

You have trained him that you will call him every month to make his payment. No need to take it serious until you've called a few times. He will never change this behavior as long as you continue to be a payment reminder service.

Keep this in mind in the future.

 

[VaDwayne]

DROP HIM!!!!! I know it's hard to pass up $3000 in commission but who wants to babysit an adult. I had this happen 2 months ago on an account about half the size of your's. Consistently late, cancelled due to non-payment. He walked into my office with a check to reinstate the coverage to which I replied, "no thanks".

I really like the commercial side of ths business because I feel like a professional agent doing it and I'm certainly not going to become a babysitting service, at least not on a small account. My steel workers account that pay's over $165,000 a year, yep, I'll babysit a little.

I am actually going there for a week in May and working with them on their jobsites so I have a better understanding of what it is they actually do. Plus being a CPR/First Aid instructor I teach their CPR/ first aid classes for free. I would charge any other company that size at least $1500 to do it.

I understand why some agents say to keep him and make the calls to remind him because you are losing money if he goes.

I was in a career for 20 years that I dreaded going into work the last 10 of it. I am never going to do that again. If it comes down to making 100,000 kissing peoples butts or 75,000 being happy and enjoying my career I will take the latter every time. GUESS WHAT, if you are happy with your career you will be even more successful and write even more business so the above statement is really a moot point.

 

[Scottyj]

VaDwayne and VolAgent you guys are right. Especially Vol I definately see that I have trained him to expect reminders. I am going to wade this one until renewal in OCT and restrict his payment options. If he does not like it then he can leave. If he does then so be it.

 

[Sales71]

ScottyJ you sound like a big commercial producer. Not sure why you do not have a CSR doing the follow up, payment cancellation audits and calling the client for you.

 

[b61mack]

Don't change your pattern, I was reading the IAA group agency guide, It has your situation in it." deviation from your established procedure could result in an E&O claim. This is an abreviated version.

 

[cottonland]

This is not a charity, it is a business. Send him written notice that due to internal changes to operating procedures, you will not be able to call to remind him about premium payments. That will help address the current E&O exposure you have with this process. Then, if you are not going to call every single customer about payments, don't call any of them. If you change to annual pay, that is fine on the front end, however you need to have a plan in place for endorsements during the year or you are back to square 1. If it were me, i would tell him to take a hike.

 

[Scottyj]

ScottyJ you sound like a big commercial producer. Not sure why you do not have a CSR doing the follow up, payment cancellation audits and calling the client for you.

I ask my brother this all the time. We are currently trying to motivate our receptionist to get licensed but she has not yet. As far as big... Haha it's all relative dude, I am still fairly new not to mention we own our own books in this office... until she gets licensed or we pick up a csr most of the clerical duties are our own as her day is one stream of constant cert requests and phone calls. We are a decent sized agency premium wise with 3 agents and one secretary as a result of breaking off from a previously larger agency.

 

[Aram Fingal]

As mentioned above, you have to be careful about calling people to remind them about making a payment because it's then considered part of your regular procedure. If you don't then do it for them every time, or for that matter don't do it for all your clients, you could be setting yourself up for an E&O claim.

The other thing I think about with clients like this, is are they going to throw me under the bus if there is a problem? If they're not responsible enough to pay their bills on time without being hounded, then when a claim comes up that isn't covered because THEY chose not to buy the coverage, are they going to say you didn't explain it to them properly? (regardless of whether you did or not)

Everyone gets their bills messed up every once in a while. But people who do it habitually can tend to be a bad risk. They're at best disorganized or scatter brained, and at worst deliberately irresponsible. That's a big part of why P&C (personal lines) rates are based on credit to a degree.

I guess you have to weigh firing them against your opinion of the client based on your personal observations. If they're a struggling business and just have trouble coming up with the money but have good intentions, it might be worth putting up with. If they're just lazy or deliberately delinquent, it might be a good idea to hand them off and make them someone else's problem.

 

[alicialouise]

You have set a precedence and risking E&O exposures with the practice of calling this client monthly. Did you say he had 12 reinstates in 12 months???? It's amazing an underwriter didn't put a block on the reinstatement's or require full payment.

You might be able to limit the E&O risk. It may require a bit of research and a little more time....

-Draft a billing history review for however long you have had the business with all carriers.
-Note each payment as received on time or late.
-Draft a separate letter advising your client that from such-and-such a date forward you will not longer be providing him with a reminder service and that in the event of cancellation of non-payment, due to the payment history (see enclosed/attached) you will not be able to guarantee reinstatement.
-Send the letter and billing review register/certified letter, requiring a signature on his part (and a trip to the PO). This will cost you about 35.00 and will get past the "never heard from you" comments.
-Be certain to file copies of the letter, history, & certified mail delivered notice (note in the letter to him a copy will be on file).
-Outline in the letter his other options, pay-in-full, pay 1/2, EFT, etc.
-Thank him for his time with you (you've been with us for xxx years, we would like to work with you to realign the billing)

With the certified letter and the billing breakdown, showing what sounds like an atrocious billing record, other billing options, and a cease date that states you will no longer provide this service (60 days out should be more than fair, unless you are near renewal, then the date the renewal packet is mailed from the carrier is good to use) you should be fairly well insulated from E&O.

You may want to call your DOI to see what they recommend or your E&O provider and you may want to review further the office practice of calling on a regular basis.

The one-of reminders - last late payment was a few months or a year ago - are just plain good customer service; but the monthly calls tend to mire you with game players who work the system to their advantage.

One last question here, it sounds like he has a fairly broad package - and you said the Auto on EFT has never had an issue - have you asked him if a different billing due date would help? This may be a cash flow issue. If it's possible for the due date to change, that might be the simplest solution of all!
Good Luck!
Alicia

 

[b61mack]

I think scotty is just venting. At least keep him until renewal time, then decide. You never want to burn bridges.