02 May Do You Know the “Why”?
Every E&O Plus agency I am honored to deal with is constantly looking to improve and get better. Part of the “better” involves achieving growth in new business writings and overall revenue growth. I do find, from time-to-time, agencies that are not sure of the brand they have in the marketplace. They think they know who they are, but when I ask them two simple yet significant questions, I am unconvinced by their answers. What are those two questions?
- On the new business you write, what was the client’s reason(s) to come to your firm?
- On the new business you lost, what was the reason(s) the client chose to leave your agency?
Let’s take a look at both.
New Business
There is certainly the possibility that price was an issue, but at the end of the day, I hope it was not the deciding issue. As the saying goes, “If you write the account based on price, you will lose it based on price.” Hopefully, there was a more overriding reason. I always want (or hope) to hear that you wrote the account because you identified a significant uninsured exposure. Surprisingly, that is often not the reason I hear. But maybe more surprisingly, there are times when the agency is not certain why they successfully brought on a new account.
My suggestion: on all new business the agency writes (this includes personal lines, commercial lines, and benefits), a form/document of some type gets completed to get to the main three reasons why your agency got the business. This practice can then be translated into a campaign that will attract even more new business.
Lost renewals
While retention is typically very strong among the E&O Plus agencies (another area where agencies should look to understand the results better), it is probably not at 100%. For some reason, some clients choose to place their business elsewhere. When I ask this question, many agencies speculate about the reason but don’t seem to be 100% certain. In commercial lines and benefits, you deal with clients that want to be better at what and who they are. So how about asking the “lost business” clients why they placed their coverage elsewhere? Maybe a question such as, “What could we have done better to continue to earn your trust and your business?” While there may be some clients who won’t want to answer that question, I am sure some will. Their answers (in total) will help the agency to figure out where they need to be better.
You may think your agency is “the best,” but does your opinion count? Isn’t the opinion of your clients more important? So for both the new business you write and the renewal business you lost, ask some questions that will tell you the value you are bringing or need to bring to the marketplace.