Tips on Closing More Business

Sep 22, 2015

  1. fredbull337
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    fredbull337 Expert

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    what is a realistic expectation of close ratio in regards to business quoted vs business written? Over the last 90 days we are currently closing about 41% of the business we quote. is 50% unrealistic? That extra 10% a month is like stealing another half a year worth of production. The obvious answer to writing more business I thought was getting more referral sources. But with more referrals comes more quotes, more quotes = more work. Wouldn't it make just as much sense to figure out how to close more of the business that is already coming in?


    Just to clarify I am talking P&C (mostly homeowners).

    Thanks,
     
    Last edited: Sep 22, 2015
  2. Indiana_Adam
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    Indiana_Adam Guru

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    I wish my closing ratio was 41%. Thats awesome in my opinion. When I was captive, 30% closing was the goal. Why not strive for the 50% I would say you are right that more quotes = more work, but you should still be actively pursuing referrals. Your referrals should close at a higher percentage than other sources. So if you can fill your pipeline with referral quotes, ideally your closing ratio will go up so you are working/quoting less than if working call-ins and cold leads. If anything, I would say up your energy being spent on getting referrals and warm introductions.
     
  3. indienoise
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    indienoise Guru

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    Depends on how you are getting prospects. My close ratio is much higher, but I am only focusing on warm prospects and referrals at the moment. If you're closing 41% on cold calling, internet leads, etc, on the other hand, that sounds pretty good.
     
  4. insurance1822
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    insurance1822 Guru

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    As an Indy w/ a bunch of preferred carriers, my closing ratio on referral business is well over 90%. As a captive (whereby I got some referrals, cross sells, internet leads etc..) my close ratio was like 15%. That being said, we did a tremendous quote volume (about 400/month..) which I think drove down my close ratio.

    I don't know what the close ratios are for an IA working anything other then referrals.
     
  5. agentofintegrity
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    agentofintegrity New Member

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    I was an IA and closed about 25% on internet leads, 65% on referrals. If you are mostly based on referrals than I don't see 50% being an unrealistic goal. When you say mostly home owners, you are including the auto as well, right?
     
  6. fredbull337
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    fredbull337 Expert

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    Sorry for taking a while to respond. We mostly write (i would say 85% Homeowners) and the majority of our business comes from mortgage brokers and State Farm. We are in a coastal region and State Farm pretty much cant write anything in our area. Currently we are undergoing one of the biggest economic booms in the nation. We have about 80 billion in new industry coming to the area (industrial plants) over the next 5-10 years. Prices for homes have sky rocketed. Being that I left the good neighbor 2 years ago to open up my independent shop we are still relatively new and we have two much bigger agencies in town that are our main competition. I looked back at our numbers for September and we quoted about 140k in homeowners premium (avg premium is around $1500/yr) and wrote a little over 81k so a tad less than 60% for September. We have yet to figure out the auto market and most of the referrals we get is the stuff state farm no longer wants, however we have a hard time with our auto carriers being competitive (progressive, nat gen, foremost, imperial)...We dabble in a little commercial but not very much. We kind of have a deal with most of the S.F. agents around here that if they send us a home they cant write we wont pursue the autos.

    It has taken us some time to earn the trust of the mortgage brokers but I think they have gotten tired of the older agencies doing things wrong and taking shortcuts.
     
  7. thecommercialguy
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    thecommercialguy Expert

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    What do you mean by "things wrong" and "shortcuts?"

    Hayato
    closingcommercial.com
     
  8. agentinsouth
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    Sounds like Fredbull and I are in the same state...
    What he is talking, for example:
    1. Writing a Ho4 for condos... I see this a lot
    2. Writing the policy for the loan amount instead of replacement cost
    3. ACV personal property
    4. Violating RESPA and paying mortgage brokers for referrals and policies
    5. Leaving off UM in one of the worst states for uninsured motorist
    That is just a few off the top of my head....

    ----------

    We are in the same state, most of my business' are mortgage brokers and realtors. I had lunch w/ one if those auto carriers you mentioned and discussed the lack of auto carriers. One huge reason is we have 4 parishes where the judges are consistently ruling that the policy max is paid regardless of the actual damage. 3 parishes are small, the forth offender is Livingston.(not small)

    Regarding close ratio, I am about where you are and am trying to figure out how to improve it!
     
  9. fredbull337
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    fredbull337 Expert

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    to add to what agentinsouth is talking about...from what we have heard from the mortgage brokers that are referring us stuff now they just got tired of the bigger agencies getting sloppy...They will refer a client to them, they wont pay attention to what they are doing and write the house and then 30 days later it gets cancelled for underwriting reasons. Then instead of reaching out to the customer to fix the problem they will just let it go and write it with another carrier when it cancels. Meanwhile the customer has no idea what is going on and calls the mortgage broker that referred them. I have come across fake dec pages, you name it. Not to mention they throw around the "our agency has 90 years combined experience in insurance" but they dont know what ISO means. Things like that

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    one of the instances that really sticks out to me was we had a guy who was going to build his own house...wanted a builders risk policy. Zurich requires that you have a GC with 2 years experience. Well obviously this guy didnt have that. Called him a week or so later to let him know we were trying to find some other avenues for him and he told us he already got a policy from one of our competitors...asked him who was the company. Zurich
     
  10. agentinsouth
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    An SF agent told a prospect not to worry about putting their second child who turned 16 on the policy due to the cost... I had to inform him that if something happened SF could come after him for insurance premium aviation.
     
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