Retaining your customers is a critical factor of success for insurance agencies. Not only does customer retention help generate ongoing revenue, but it also helps build trust and credibility of your business. Customer relationship management is an important part of this process.
As a licensed independent insurance agent, I understand the importance of having good customer retention rates. Retaining your customers allows you to generate ongoing revenue and build trust and credibility for your business. To improve your customer retention, you’ll have to examine your customer relationship management.
In this article, we will discuss the importance of improving your customer retention, best practices to do so, and provide tips on maintaining these relationships. Let’s get started!
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The Importance Of Improving Customer Retention
As an independent insurance broker, I know how important customer retention is for insurance agencies. Customer retention is important for a variety of reasons, and it is important that insurance agencies constantly strive to improve them. Improving customer retention is important for a number of reasons:
- Ongoing Revenue: Retaining customers helps to generate ongoing revenue for your business. It is generally less expensive to retain an existing customer than to acquire a new one, so improving customer retention can help to increase the overall profitability of your business.
- Building Trust And Credibility: Building strong relationships with customers helps to build trust and credibility for your business. Customers who feel valued and satisfied are more likely to continue doing business with you, and they may also refer friends and family to your agency.
- The Cost Of Acquiring New Customers: Acquiring new customers can be expensive, as it often requires marketing efforts and resources. By improving customer retention, you can reduce the need to constantly acquire new customers, saving time and resources.
Retaining Clients Versus Acquiring New Clients
On average, retaining clients is much more affordable than acquiring new clients! Because of this, it makes sense to focus on keeping your existing book of business intact and maintain high retention rates!
Here are a few statistics on the cost of retaining clients versus acquiring new clients:
- Retaining a current customer is often cheaper than acquiring a new one. According to a study by Invesp, it can cost five times as much to acquire a new customer as it does to keep an existing one.
- According to a study by Gartner, increasing customer retention by just 5% can increase profits by 25% to 95%.
Best Practices For Improving Customer Retention
As an insurance professional, I know that there are a lot of steps you can take to improve customer retention. While it is important to choose the processes that work best for your insurance agency, there are some general practices I recommend for just about every agency.
There are several best practices for improving customer retention in the insurance industry:
- Provide Excellent Customer Service: Providing excellent customer service is a key factor in retaining customers. This may involve responding promptly to customer inquiries, addressing customer concerns and complaints, and going above and beyond to meet customer needs.
- Build Strong Relationships With Customers: Building strong relationships with customers is essential for retention. This may involve getting to know your customers, understanding their needs and preferences, and offering personalized service.
- Use Customer Relationship Management Software: Customer relationship management (CRM) software can help you to manage and nurture relationships with customers. CRM software can be used to track customer interactions, manage customer data, and automate tasks such as sending emails or following up with customers.
Software To Help Maintain Great Retention
Maintaining the appropriate software in your agency will help boost your retention. After implementing proper software, and automation tools, I was able to retain over 90% of my clients on an annual basis.
Consider this table and check out our article on insurance automation tools for more info!
|Software||Description||Benefits For Retaining Clients|
|CRM||Customer Relationship Management software helps manage and organize customer interactions and data.||Allows insurance agents to easily access and update client information, schedule follow-up appointments, and track communication history.|
|Policy Management||Software that helps manage and organize insurance policies.||Allows insurance agents to quickly access and update policy information, track policy renewals and expiration dates, and send automatic reminders to clients.|
|Digital Signature||Software that allows electronic signing of documents.||Allows clients to easily sign and submit forms and documents online, reducing the need for in-person meetings and increasing convenience for clients.|
|Claim Management||Software that helps manage and organize insurance claims.||Allows insurance agents to easily track and update claim status, communicate with clients about their claims, and provide quick and efficient service.|
|Marketing Automation||Software that automates marketing tasks and campaigns.||Allows insurance agents to easily send targeted and personalized marketing messages to clients, increasing the chances of retaining clients through effective communication and engagement.|
This next section details the different insurance agency CRMs I’ve used over the years. Each has their own set of benefits (I prefer EZLYNX).
|AgencyBloc||A CRM platform designed specifically for insurance agencies. It offers features such as contact management, policy management, and automated workflow.|
|Applied TAM||A CRM platform for insurance agencies that offers features such as policy and client management, automated workflow, and reporting.|
|Applied Epic||A CRM platform for insurance agencies that offers features such as policy and client management, automated workflow, and reporting. It also integrates with Applied Rating for rating and underwriting capabilities.|
|Salesforce||A widely-used CRM platform that offers a range of features, including contact and account management, automated workflow, and reporting. It can be customized to fit the needs of insurance agencies.|
|Zoho CRM||A web-based CRM platform that offers features such as contact and account management, automated workflow, and reporting. It can be customized to fit the needs of insurance agencies.|
|EZLynx||A CRM platform for insurance agencies that offers features such as customer management, policy management, automated workflow, and reporting. It also includes integrations for rating, document management and agency websites.|
Tips For Maintaining Strong Customer Relationships
Once you have established strong relationships with your customers, it is important to maintain those relationships in order to improve retention. As an independent insurance broker, I know that sometimes maintaining these customer relationships can be difficult for a variety of reasons, but it is important to do so to improve your retention rate.
Here are some tips for maintaining strong customer relationships:
- Stay In Touch With Customers: Keep in touch with customers by sending regular updates and newsletters, or by reaching out to check in on their needs and preferences.
- Seek Customer Feedback: Seeking customer feedback can help you to understand what your customers like and dislike about your agency, and can provide opportunities for improvement.
- Resolve Customer Issues Promptly: When customers have issues or concerns, it is important to address them promptly and effectively. This helps to build trust and credibility, and can improve customer satisfaction and retention.
As an independent insurance broker, I understand the importance of customer retention in the insurance agency. Improving your customer retention is crucial for the success and stability of your agency, providing ongoing revenue and building trust and credibility for your agency. Be sure to follow the tips and best practices outlined in this article to help you improve your customer relationship management techniques, and increase your retention rate.
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