As an insurance agent, you will most likely be faced at some point with a client who wants to cancel the policy that you sold them. Even if that does happen, though, it doesn’t mean that it’s all over: you still have the opportunity to keep that client by speaking with them and helping them to understand certain things about their policy. To keep your clients’ business, or to prevent them from canceling a policy in the first place, you will need to take the following steps so you can continue to grow your business.
Understand Why They Are Leaving
Clients don’t just wake up one day and decide that they no longer want an insurance plan; they usually spend time thinking it over, and they might have multiple reasons for wanting to cancel. They might be unhappy with your customer service or with the cost of the plan, or they could be going through a major life change, which means that the plan they have will no longer fit their needs. Take the time to talk with your customers and figure out the reason they have decided to cancel the plan you found for them.
Create Loyal Customers
Studies show that 89% of consumers are more likely to make another purchase after a positive customer experience; on the other hand, a customer who is not happy will generally not think twice about canceling their plan and will not come to you to find other options. This means that working to create loyal customers is hands-down the best way to avoid losing business: when someone is happy with your service, they will want to continue to work with you, and instead of immediately canceling their policy, they will be more willing to talk to you about finding a different plan.
Another great way to keep your customers happy is to check in with them on a regular basis with calls, text, or emails. This will show them that you care about them and their needs, and will make them feel more comfortable about reaching out to you with any issues they have, including doubts about their policy. After all, 83% of customers agree that they feel more loyal to companies that respond to and quickly resolve their complaints.
Addressing Common Reasons For Cancellation
Unfortunately, sometimes there is nothing that you can do when a customer wants to cancel a policy. It happens, so don’t take it personally, but knowing the common reasons clients cancel can help you better address these issues. The main reasons include:
- Change in assets– A business owner or an individual might want to cancel a policy because they are closing their business, downsizing, or selling their property. Notify your clients that you can make changes to their current insurance policy to better fit their needs and budget; you can offer to reduce their coverage, or even add new coverages if need be.
- Prices went up- This happens all too often: an insurance company raises their prices, and your clients want to cancel their policy and find a cheaper one. Remind them that you can help them find a better plan when you compare quotes and policies, and reassure them that you will do your best to find a plan that matches their needs, and is in the same price range as their original plan.
Many clients are probably unaware that they will be harming themselves by cancelling a policy and not having a new one ready. There are risks that come with cancellations, not least of which is that stopping and starting coverage is a red flag for many insurance companies, meaning your client could end up paying more for a new plan. Not only that, but if they are cancelling a commercial insurance policy, they could risk losing their business licenses and permits, and will also be fully financially responsible for any damages or theft that could occur while they are uninsured.
Inform your clients about any and all risks they might face – not to scare them, but to show concern for them, and to make clear the repercussions they could face for going uninsured. But in the event that they still choose to go, how you handle it can make a friend or foe: if you handle the situation with grace, you can stay on good terms and keep an open line of communication with the client. In that case, you will be able to ask them about their experience with you, and what you can do to improve your customer service. Knowing how you can change or what you can do to help can make all the difference to your business – and remember, a client wanting to cancel their policy is not the end of the world, so take a deep breath, and proceed with turning a cancellation into an opportunity.