How To Improve Your Auto Insurance Loss Ratio

How to Improve Auto Insurance Loss Ratio article by eHow.com

• Step 1:
  Check out the area where the individual lives. Although insurance companies know where the highest crime rates occur, these are often in chart form and as averages. You have the advantage because you know your town well. Don't market to these areas.
• Step 2:
  Use several different companies for quotes. If you find iffy behavior in your client, don't quote companies that offer a bonus for improved loss ratio. You can't refuse to sell insurance, but you don't have to use the same company for every client.
• Step 3:
  Watch the client's behavior on the cell phone. If it rings constantly while you're interviewing him and he responds, chances are he answers while he drives. This can cause accidents, so use an alternative company for his application.
• Step 4:
  Direct your marketing list to married men and families, because married men often have fewer accidents than single men the same age. Younger women statistically have fewer accidents and tickets than men the same age, so marketing to women is another option.
• Step 5:
  Recommend higher deductibles for your clients. Many accidents are fender-benders that don't meet high deductibles or are so close that clients prefer to pay for the damage themselves rather than incur a claim. By recommending a higher deductible, you lower the amount of premium you receive. But that doesn't matter because the potential payouts keep your loss ratio a lot lower.
• Step 6:
  Secure referrals from clients you know have excellent records. Most people enjoy the company of people similar to them. The maniac driver is seldom included in the carpool-driving list. Ask your clients for names of people they consider good drivers. Explain that the fewer accidents paid by the company, the lower the premium becomes in the future.
• Step 7:
  Include all the information you can when you're writing an application for clients, and select your marketing list carefully. Ask about any drivers who frequently use the car. A good driver might have a crazy boyfriend or girlfriend who often drives the car. Know your clients well. Include all the information about them on

Recruiting Young Producers Can Pay Big Dividends

The article below is from National Underwriter online and is good food for thought for all agency owners.

Recruiting Young Producers Can Pay Big Dividends, Study Finds

Given mentoring and the proper resources, college recruits excel

• By BRIAN MCNEELY AND ANGELA BEMISS

Published 3/19/2010

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Many in the industry have long held the view that hiring young production talent is a bad idea. You often hear people say “young people can’t command the respect of the clients, so they probably can’t be successful,” or “they will just leave us in a few years after we’ve invested in their training,” or “young people have never worked out for us.”

In the summer and fall of 2009, Reagan Consulting—in conjunction with The Council of Insurance Agents and Brokers, UNUM, Chubb and Hanover—conducted “The Young Producer Study” to test the validity of these assumptions. (You can access the entire Young Producer Study at www.reaganconsulting.com.)

The study was designed to determine if there was an opportunity to hire more young production talent and document the best practices in hiring young producers.

Young producers were defined as producers hired when they were under the age of 30, hired in the last 10 years, and selling commercial property and casualty insurance or employee benefits.

The first part of the study was an assessment of the industry as a whole to determine the baseline level of hiring for these young producers. The survey included 206 agents and brokers (firms) throughout the country, with the data used as a proxy for the industry as a whole.

Based on the survey results, the success of young producers (48.6 percent) was approaching the success rate of all producers in the industry (53.0 percent), with the success of 23.4 percent of the young producers still unclear.

This data confirmed our belief that some firms were having success attracting, hiring and retaining young producers, and that there is an opportunity to learn from the best practices they were employing.

The next step was a deeper investigation of the firms and producers identified in the baseline study that were experiencing success. Fifty-four firms agreed to complete a detailed survey on their hiring and development practices for young producers. The firms also agreed to identify one or two young producers they considered successful.

A total of 91 successful young producers were indentified, completing a detailed survey about their educational background, a personality and behavioral assessment, and an interview. The firms also provided data on each successful young producer’s production history.

During this process we met and interviewed an extremely talented group of successful young producers and developed a deep understanding of the best practices employed by the successful firms in regards to attracting, hiring, developing and retaining young producers. There were three primary takeaways from our look at successful young producers:

• College Recruiting Works.

The 91 successful young producers that participated in the study were recruited from various sources, including other industries, other firms, college, insurance companies and in-firm transfers.

College, however, was easily the most popular source for successful young production talent. This certainly makes sense given that colleges and universities are concentrated sources of talented individuals, but it also contradicts conventional industry wisdom regarding college hiring.

Further, the success of producers hired directly from college was similar to that of those hired via other sources with regard to production numbers and time to validate.

• Well-Rounded Individuals Often Perform Best.

There wasn’t one characteristic of the successful young producers that stands out. Rather, what was apparent after analyzing the backgrounds of these individuals was their capacity to be involved in many activities and leadership roles while maintaining strong academic credentials.

However, interestingly, in terms of months until validation (when the commissions a producer generates at least equals their personal compensation, so they are in effect paying for themselves), a grade point average over 3.5 did not indicate greater success than that of those with a lower GPA, and within the group the producers with the highest GPA validated slowest.

Also, neither prior sales experience nor a specialty focus indicated success at a greater rate than that of those without prior sales experience or those that were generalists.

• Young Producer Economics Are Attractive.

When compared to hiring other experienced producers, the economics associated with hiring young producers can be attractive. As might be expected, the initial investment (salary) in a young producer is typically much lower than that of an experienced producer.

However, we also determined that successful young producers can perform at a level comparable to successful producers of all ages when give the appropriate resources.

Given the difficult economic environment we find ourselves in, both the relatively low initial investment of a young producer and the ability to generate organic growth for the firm could prove to be attractive.

With all that said, hiring, training and retaining young producers is a different game. Those firms that will succeed must do four things well.

• First, if they want to recruit college kids, they must establish a presence on college campuses as a means to identify the best talent.

• Second, the firms should invest in mentoring of the young producers to the point that mentoring becomes part of their firm’s culture.

• Third, young producers should be hired in classes, fostering a collegial bond among the young producers.

• Fourth, the young producers should be provided with resources that will make them successful.

In summary, young producers will not be able to rely only on experience to win business, and firms that can provide support to young producers via experienced producers or in-house risk management or other resources will have greater success.

None of this is to say that hiring experienced or “older producers” is a bad idea. However, “The Young Producer Study” confirmed our suspicion that a large, untapped resource exists for firms in their search for production talent.

There are compelling advantages young producers can bring to firms from a cultural perspective in the form of energy and enthusiasm, as well as practical advantages from the perspective of shareholder return and client relationship perpetuation.

While it won’t work for everyone, the opportunity to hire and develop young producers is compelling and worth exploring.

Brian McNeely (Bmcneely@reaganconsulting.com) is a consultant and Angi Bemiss(Angi@reaganconsulting.com) is senior vice president at Reagan Consulting Inc., an Atlanta-based management consulting firm that developed and produces the “Independent Insurance Agents and Brokers of America Best Practices Study.” More information about the firm can be found at www.reaganconsulting.com.

Tague Alliance - Home Insurance and Auto Insurance Questions

The questions below will prove helpful in determining a client's needs regarding their auto insurance and home insurance.

AUTOMOBILE INSURANCE

1. Have you considered increasing your deductible to lower your premiums?

2. Are your liability limits adequate to protect your income and assets from a negligent lawsuit?

3. Do you presently insure all of the vehicles in your household?

4. Are all the licensed drivers in your household listed on your automobile policy?

5. If you own a pickup or a van, does it contain any customized equipment?

6. Do you own any camping or recreational vehicles (including electric or gasoline driven golf cart)?

7. Do you have a non-factory installed stereo system?

8. Do you have a vehicle, not your own, furnished for your use?

9. Do you have rental car coverage in the event your car is damaged in an accident?

10. Have you reviewed your auto insurance in the last two years?

11. Would you like to review the current limits and other coverage's on your vehicles to see if they are still suited to your needs?

HOMEOWNERS INSURANCE / RENTERS INSURANCE1

1. Do you own any antiques, fine art, or paintings?

2. Do you own any jewelry, furs, or silverware valued over $500?

3. Do you own any guns?

4. Do you have replacement cost contents coverage added to your policy?

5. Do you presently have either a burglar, fire or smoke alarm in your home?

6. Have you remodeled your home recently? Do you plan to in the near future?

7. Would you like an estimate of your home's replacement cost at today's prices?

8. Do you own a second home or any other real property such as a mountain cabin or farm property?

9. Do you conduct any business or give private lessons in your home?

10. Do you own any rental or investment property?

11. Do you have an Excess Liability (umbrella) policy which extends your automobile and homeowners liability coverage to $1,000,000 or more?

12. Would you like us to send a form to assist you in making an inventory of your personal property?

13. Have you reviewed your homeowners coverage in the last 2 years?

14. Do you currently have a photo inventory of your personal property?

15. Would you like a review of your current homeowners coverage?