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The Rough Notes Company Inc.



October 29
10:12 2018

Beyond Insurance


Seven sticky strategies to enhance customer loyalty and keep competition away

I recently received a call from a Georgia-based agency leader with both good and bad news. The good news is that his agency has been able to attract numerous prized new accounts using the consultative and diagnostic approach taught in Beyond Insurance workshops. The bad news is that his firm’s retention on these customers stands at 72% after three years. He said, “We work so hard to identify and attract new clients, only to have them go out the back door when a national broker comes calling. Can you recommend strategies to enhance customer loyalty and keep competition out?”

I suggested seven strategies:

Strategy 1—Pre-Renewal strategy session.

A strategy session held at least 90 days in advance of the renewal date will give your clients clarity and confidence about the renewal process. A face-to-face session supported by an agenda enhances credibility and sets the stage for this critical meeting. Knowing that there are dozens of competitors knocking on your client’s door makes it imperative that the pre-renewal strategy session be carefully orchestrated. Your advance preparation is worth its weight in gold.

  • Components of the strategy session are:
  • Concise overview of the existing insurance program
  • Risk and exposure analysis
  • Business update with a focus on operational changes
  • Risk control initiatives update
  • Loss history and claims summary overview
  • Exposure basis update
  • Consideration of additional insurance protection, as appropriate
  • Overview of current market conditions
  • Underwriter’s renewal position
  • Offer to give the insured direct access to underwriter to convey best-in-class attributes (phone or in person)
  • Review of historical marketing of account
  • Risk management service plan progress report and discussion of how it will be used to leverage the underwriting process
  • Comment on pertinent issues surfaced in the stewardship review three months previously
  • Agreement reached on marketing strategy, objectives, and timeline
  • Confirming email or letter sent

Strategy 2—Direct access to underwriter.

Successful agents and brokers establish meaningful relationships with their underwriters and field marketing specialists. They enjoy open, honest interactions and hold each other accountable for commitments. When trust and respect are established, each party reaps tremendous benefits. These same agents encourage their clients to build personal relationships with their underwriter as they recognize that this tactic helps to:

  • Reduce outside competition on key accounts
  • Eliminate unnecessary bidding exercises
  • Reduce time involved in market research
  • Enhance client and carrier alignment
  • Improve retention

Most clients see their insurance carrier as a “black box.” Besides periodic risk control visits and tenuous discussions with claim representatives, they have not been given the opportunity to build meaningful relationships with their underwriter and/or field marketing specialist. Direct access to the underwriter is a winning strategy to keep competition at bay.

Strategy 3—Stewardship review. This review, conducted six months after the inception date of the insurance program, reaffirms that your agency’s insurance and risk management strategies are aligned with those of the client. It is also a time to actively listen to the client speak about goals, opportunities, and struggles.

One dictionary defines stewardship as “managing for others, one who directs affairs. Guardian. Manager.” What are some reasons to perform stewardship reviews?

  • It demonstrates your knowledge of the client’s business and risk issues and your desire to continue learning more.
  • It gives you the opportunity to reinforce the quality and integrity of your work product.
  • You have a captive audience with your client’s executive team.
  • The process is strategic, consultative, and diagnostic, and it reaffirms the importance of your business partnership.

If you are not now conducting stewardship reviews with key clients, when you do so you will find that the benefits will be greater than you ever imagined. The return on investment will be immense as measured by reduced competition as well as cross-selling and referral opportunities. A stewardship review also will enhance your brand in the marketplace.

Strategy 4—Risk management service plan. A risk management service plan identifies the objectives, standards, and steps for the implementation of risk mitigation and claims management services. Importantly, the plan serves as a blueprint for the achievement of specific goals and holds you and your client accountable for service commitments. It is a powerful document that gives evidence of your quest to provide unparalleled services, resources, and solutions throughout the year.

The impact of client loyalty includes renewals without threats of switching, brand loyalty to your agency, and positive word of mouth about you.

The service plan should be fully developed at least 30 days in advance of your client’s renewal date. The design of the plan represents a collaborative effort among you, your client, and the insurer’s risk control and claims consultants. Here are some benefits of developing a service plan:

  • Shifts your client’s focus away from the insurance transaction to risk profile improvement
  • Serves as a tangible document demonstrating your ongoing commitment to serve your client’s best interests
  • Creates a meaningful working relationship among you, your client, and the carrier

Gives the underwriter enhanced comfort and reasons to offer preferred terms

Strategy 5—Deepen and broaden client relationships. Loyalty is commonly defined as faithfulness or devotion. Richard L. Oliver, the renowned consumer scientist and Vanderbilt University professor, described customer loyalty as “a deeply held commitment to re-buy or re-patronize a preferred product or service consistently in the future despite situational influences and marketing efforts having the potential to cause switching behavior.”

The loyalty effect is created when your client becomes an advocate of and evangelist for your services and solutions. The impact of client loyalty includes renewals without threats of switching, brand loyalty to your agency, and positive word of mouth about you.

In the early 1980s, Fred Reichheld and his colleagues at Bain & Company began investigating the connection between loyalty and growth. The research confirmed that businesses cannot prosper without customer loyalty. Yet there was no practical metric for relationship loyalty. Companies lacked a system for gauging the percentage of their customer relationships that were growing stronger and the percentage that were growing weaker.

To the surprise of Reichheld, the one question that captured the essence of the research was:

“How likely is it that you would recommend Company X to a friend or colleague?”

Reflecting on his findings, Reichheld and his colleagues realized that this question made perfect sense because two conditions must be satisfied before a consumer makes a personal referral:

They must believe that you offer superior value in terms of features, quality, functionality, ease of use, and other practical factors.

They must believe that you know and understand them, value them, listen to them, and share their principles.

Today this simple question is asked by many of the most admired companies in the world through a metric that produces the Net Promoter Score® (NPS).

Strategy 6—Deepen and broaden client relationships. Getting where you want to go in business—road map for developing outstanding business relationships—is contingent on under- standing your clients’ Relational GPS™. (Relational GPS is a registered trademark of the Relational Capital Group.) GPS stands for: Goals, Passions and Struggles.

People will not share these with you until they feel confident and comfortable in the relationship. Your credibility, integrity, and authenticity can persuade your clients to share their GPS. Once your client allows you to navigate his or her GPS, you have the road map for a long-term relationship leading to trusted advisor status. Knowing a client’s GPS also enhances your ability to move through the renewal process successfully and without competition.

It is also essential that you broaden the scope of relationships within each client partnership. As risk and risk management touch every aspect of an enterprise, there is reason to move beyond the CEO, CFO, and HR manager to build relationships with facilities managers, IT professionals, safety committee heads, supervisors, and the rank and file.

You also should get to know other professional advisors who serve your client, such as their CPA, attorney, and banker.

Strategy 7—Teach your clients things they do not know. In the book The Challenger Sale, Matthew Dixon and Brent Adamson state that “surveys of customers consistently show that they put the highest value on professionals who make them think, who bring new ideas, who find creative and innovative ways to help the customer’s business. In recent years, customers have been demanding more depth and expertise. They expect professionals to teach them things they don’t know.”

Huthwaite International, an acknowledged thought leader in sales performance, reviewed more than 35,000 sales transactions over a 12-year period and determined that consumers will pay a premium, redefine the buyer/seller relationship, erect barriers to the seller’s competitors, and establish the seller as a trusted advisor when two primary activities occur:

  • Seller reveals to the buyer an Unrecognized Problem
  • Seller establishes for the buyer an Unanticipated Solution

Your relationship will become extra- sticky when you consistently understand your clients’ issues, study the implications, and deliver timely solutions.

When you understand the value of a long-term client relationship, you will find it is worth your while to implement the seven strategies described above to enhance loyalty and keep competition away!

The author

Scott Addis is the CEO of Beyond Insurance, a consulting firm that offers leadership training, cultural transformation, and talent and tactical development for enlightened professionals who are looking to take their organization to the next level.  Since 2007, the proven and repeatable processes of Beyond Insurance have transformed organizations as measured by enhanced organic growth, productivity, profitability, and value in the marketplace. Contact Scott at

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