Chapter 2 Flashcards
Describe how sales plans are influenced by the agencies or brokerages objectives and by the insurance markets
Sales planning is part of strategic planning and takes place at management level. Management devices both a strategic plan and an operational plan for an entire agency or brokerage setting out goals objectives and targets and taking into account the particular expertise of the agency or brokerage and the products and markets available. Sales plans are based on individual strengths and weaknesses of the agency or brokerage staff in addition to the types of businesses the staff is experienced in selling. These plans are usually presented annually and include all areas of agency or brokerage operations
What does sales planning begin with?
The planning begins with projection of sales forecast. Generally, sales objectives are expressed in terms of the amount of business to be written and the type of business targeted and are reviewed periodically through an annual planning period.
How are sales planning figures usually express?
Sales planning figures are usually expressed as the total annual premiums. Sales forecasting includes considering retention rates of renewals, upselling existing policies, and planning for new policies
How did the different types of intermediaries reach perspective customers?
Direct writer- does not sell insurance through the agency or brokerage channel, utilizes traditional advertising methods such as mail, magazines, radio, and television, along with modern approaches available on the Internet. Well brokerages will often knock on the door of their prospects, direct what writers wait for a call. Usually the first thing the prospect will hear when calling a direct writer is, press one if you are a new client, press two if you’re in existing client. The insurer will expediate the process for new prospects since they do not have the patience to stay on hold as long as an existing client.
How do insurance companies differentiate Target markets
Because insurance companies need to make a profit to stay in business, and tours identify specific types or classes of clients they expect to be profitable Insurance risks and design their products and marketing strategies to attract these clients.
Define group or affinity insurance program
One personal insurance, insurer’s, agencies, and brokerages often Target based on occupational class. When an insurer offers a program to a specific category of individuals.
How do brokerages define their target market?
For brokers, selecting the right market requires that their knowledge of the market’s product offering and risk appetite be extensive. Brokers considered their company’s market alternatives and maximize success in sales by targeting clients who most closely fit the profile these insurers also wish to insure
To have a productive discussion with the client, the intermediary must research the products available that match the client’s expectations. Then, the agent or broker should do the following
- Ask open-ended questions to uncover the clients insurance needs and exposures. Open any questions require more than a yes or no answer. Instead of asking do you drive to and from work ask what do you use your vehicle for
- Match these needs with satisfires in the insurance products satisfiers are the elements of a policy that will meet the client needs
- Close the meeting or conversation with questions that lead the client into accepting the product. For example, do you want the package with a $1 million or 2 million liability limit? Or when do you need the policy to be effective?
The insurance policy agrees to provide indignity in the event of a specific happening. Whether an insurance policy is a product or service depends on perspective list three perspectives
- It is a service from the perspective of the intermediary, who is paid either a commission or a salary to match the client with the insurer
- Is a product from the perspective of the insurer, who has many different types of policies available on the market suitable to specific types of consumers based on their needs
- It is both a product and a service from the perspective of the client, but is intangible in something he or she hopes never to need
What two agencies must the broker or agency comply with in regards to privacy legislation?
Information protection and electronic documents act (PIPEDA)
&
CANADIAN ANTI-SPAM LEGISLATION
This legislation has affected how intermediaries approach cold calling and tracking expiry dates, as they must have consent from the parties to contact them or a prior relationship with them within the last 2 years.
Define PIPEDA
A federal statute that governs the collection and use of personal information. It states that personal information to be collected must be relevant and that all information that has been collected, is being collected or will be collected must be held in the strictest of confidence
Define the Canadian anti-spam legislation
This legislation applies to all electronic messages that organization send in connection with a commercial activity. A key feature requires Canadian and global organizations that send commercial electronic messages within, from, or to Canada to receive consent from recipients before sending messages.
List 7 approaches to locate prospectives
- Referrals
- Online marketing
- Advertising and walk-ins
- Cold calling
- Tracking of expiry dates
- Upselling
- Cross selling
Define cold calling
Cold calling is a making contract with an unknown person to introduce the agency or brokerage and its services. Prospective clients contact information could be derived from a neighborhood directory or from a list that has been narrowed to meet certain criteria, such as those within a certain age group, and come love and, or industry.
Define cross selling
Cross selling comes from business that already exists. It still requires sales but is again founded on the existing client base. Cross selling can be both selling insurance to new clients and rounding the insurance plans of existing clients. Either way, this is a method with a solid base, and existing happy client. For most intermediaries, referral based cross-selling represents a large portion of their new business.
