Overcoming Top Insurance Broker Challenges

May 6, 2021

A recent PwC survey of CEOs in diverse industries uncovered some of the top challenges today’s insurance industry professionals face. Those cited included lead generation, inconsistencies stemming from health care reform, and price-related competition. While each cannot be dismissed lightly, there are strategies that can help mitigate these challenges.

New Ways to Generate Leads

Insurance is one of those products that has a customer perception problem in that many consumers are not sold on the fact the insurance really is a necessity. For those that do understand the need for insurance, its association with end of life or illness makes it an unpopular purchase or at least one that many want to keep putting off. Overcoming these attitudinal challenges requires out-of-the-box thinking and more efficient ways to capture leads.

One way is to think niches, for example, those relate to a specific demographic such as a certain ethnic group, profession, geographic territory, etc. Underserved markets can be an especially strong source of new leads. Working with a reputable list house, brokers can obtain opt-in email addresses and/or postal addresses and phone numbers for prospective customers that meet key selection criteria. For brokers selling through employers/plan sponsors, these selections could include title of the individual, number of employees/plan members, industry, etc. Then, by developing clear, well-written messages, they can convey the role and value of a particular product. Each message should have a call to action that makes it easy for the recipient to contact the broker and/or obtain more information about a particular product(s). As part of this convenience factor, it helps to have an accessible online platform where individuals can access information on their own from any device, 24/7.

Offset Health Care Reform Complexities with Education

While it has been around since 2010, the “Patient Protection and Affordable Care Act” (“The Affordable Care Act”) continues to create challenges for many. It is complex with many moving parts that confuse consumers, plan sponsors and brokers. Among the areas of confusion and concern are those relating to preferred providers, who is responsible for what coverage, and what is and is not covered. That said, in addition to staying abreast of any new developments regarding this groundbreaking health care reform legislation, brokers can assume a heightened role as trusted advisors by continually educating their clients on this topic and offering solutions to help both plan sponsors and members. They can offer market high quality, flexible medical stop loss solutions to plan sponsors to help them contain their increased costs under the Affordable Care Act, and they can recommend voluntary product solutions to help members supplement their health coverage.

Voluntary products continue to be well-received by plan sponsors and members alike. Even amidst the pandemic pandemonium, Moody’s continues to remain bullish on the long-term future of voluntary benefits which have grown at a compounded annual growth rate a year at the same time that employer-paid benefits declined.

The Trust Factor

Building trust continues to be a foremost goal for all brokers as there still remains a level of distrust of insurance professionals by the general public that must be overcome. This was reflected in a recent TrustPilot survey wherein 31% of the 15,000 survey respondents viewed the finance/insurance as “generally untrustworthy or not trustworthy at all,” 24.1% found it only “somewhat trustworthy,” and just 23.9% saw it as “a little trustworthy.” By expanding their roles as advisors and educational resources, offering advice and information that helps clients make informed decisions, a better relationship built on trust will form.

Win the Price Game

Price competition will always be a constant in insurance sales, but it does not have to be an obstacle. Successful brokers have no problem overcoming a competitor’s lower price. That is because they have built a relationship where an insurance sale is not a commodity sale, but a sale based on a trusted relationship backed by responsive, high quality service. By working with well-established, highly rated insurance carriers (i.e., those that hold an A.M. Best A (“Excellent”) rating, brokers can access a broad suite of solutions that respond to market needs and are price-competitive.

To quote Michael Jordan, winner of six NBA championships and six Finals player MVP awards, “Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it.”